Anchorage Daily News

Consumer prices in the Anchorage area increased 4.6 percent over the past year, the biggest increase in 17 years, according to the federal Bureau of Labor Statistics.

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In the past six months, local inflation increased more quickly than it has in at least 20 years.

What's factored in? Prices for transportation, food, alcoholic beverages, housing, utilities, medical care, clothing and recreation.

How are local shoppers coping?

Area retailers said they are seeing more savvy customers, who more frequently ask for price checks, hit the discount aisles and crunch the numbers to make sure they don't exceed their budget.

"Some of them bring their calculators," said Maricel Juan, a department manager at the Gottschalks store in South Anchorage.

Inflation in Anchorage over the past year was greater than it was for the United States as a whole in the same time period -- 4.2 percent -- but not enough to make the difference statistically significant, said Neal Fried, a state economist.

That's probably not comforting to people whose salaries aren't keeping up with inflation.

"My guess is, with this big a spike in the local cost of living, it's going to be hard for wages to keep up," Fried said.

ENERGY

The increased rate of inflation in Anchorage has mainly been driven by higher gasoline costs, said Todd Johnson, an economist for the Bureau of Labor Statistics.

Gas prices rose 35 percent in Anchorage in the past year, according to the federal data.

While fuel prices might be higher in Anchorage than they are in the Lower 48, the gas price inflation here has been slightly less extreme.

National gas prices rose 37 percent over in the past year, the federal statistics show.

Not all energy prices increased locally.

The cost of electricity in Anchorage declined 3 percent in the past year; also, prices for natural gas in homes declined 1.7 percent for the year.

That's in contrast to steep increases in the price of electricity and natural gas nationwide.

FOOD

Prices for food and beverages in Anchorage increased 5 percent in the past year.

The price of alcohol inched up 0.1 percent over the past year.

Those numbers aren't surprising to Glenn Peterson, the district manager for Safeway grocery stores.

He said Safeway, which sends its products to Anchorage on container ships, used to face fuel surcharges on its shipments once a year. Now the Alaska stores face constant fuel surcharges, and those are mainly passed on to consumers.

Anyone who shops is seeing ever-increasing prices, especially on products such as meat that take a lot of energy to produce, he said.

Even though its distance to market is shorter, locally produced food also faces major shipping costs. "They have to get their fertilizer and seed (from the Lower 48) too," Peterson said.

APPAREL

In Anchorage, the price of clothing jumped 10.9 percent over the past year.

"In a weird way, that's the most interesting (trend)," Fried said.

Clothing prices in Anchorage have usually been flat or falling in recent years, he said.

He couldn't explain the increased cost of clothing. It doesn't mimic the national trend, he said.

National prices for clothing increased only 0.8 percent over the past year, according to federal statistics.

Several Anchorage retailers contacted Wednesday said they hadn't noticed a significant uptick in clothing prices.

Manufacturers have ratcheted up prices on some products, such as Levi men's jeans, which recently went up $4, said Gottschalks' Juan. But she said those markups affect stores nationwide, not just the ones in Anchorage.

Mike Herzog, store manager at REI, said that there is no difference between REI's prices in Anchorage and in the Lower 48.

But he's noticed that prices for raw materials, ranging from wool to fleece, are increasing.

Also, "Our shipping costs have gone through the roof," he said. "We have surcharges on top of surcharges."

Find Elizabeth Bluemink online at adn.com/contact/ebluemink or call 257-4317.<

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