Prices charged by producers jumped in November and rose nearly 10 percent over the past year, according to data released Tuesday by the Labor Department.
The producer price index (PPI) for final demand, which tracks prices charged for goods and services that are not a part of other products, rose 0.8 percent in November on a seasonally adjusted basis, accelerating from a 0.6 percent increase in October.
The PPI for final demand rose 9.6 percent annually in November, marking the fastest annual growth in the index since the Labor Department began calculating in 2010. Without food, energy and trade services, PPI for final demand rose 0.7 percent in November and 6.9 percent annually, another record.
The November surge in producer prices came as manufacturers, shipping companies and retailers struggled to meet intense consumer demand.
U.S. consumer spending on whole has roared above pre-pandemic levels thanks to a relatively rapid recovery. While American spending has helped fuel a quicker comeback, it has also added pressure to supply chains.
Producers and suppliers are wading through shortages of key supplies, port bottlenecks, COVID-19-related shutdowns abroad and hiring troubles in transportation industries. With supply limited, many producers have raised their prices to compensate, which has also lifted prices paid by consumers.
President Biden has spent months pushing to loosen supply chains as consumer price growth has surged through 2021. The White House secured commitments from major shipping companies and port workers to operate 24/7 and has frequently huddled with major business leaders as they attempt to work through disruptions.
The Biden administration has also blasted several industries that they claim have boosted prices far beyond the costs of disruption, including the oil industry and meat producers.
Even so, the global nature of supply chain disruptions and ongoing uncertainty driven by the pandemic gives Biden little direct power over the snarls.
Republicans have called on Biden and Democrats to abandon their plans for a $1.75 trillion climate and social services bill, which GOP lawmakers claim would stoke inflation higher. The White House and many left-leaning economists insist the bill will not be inflationary because it adds relatively little to the national debt and is designed to lower child care and medical costs.