After a significant climb in September, inflation rose again in October—signaling the ongoing financial crunch that many employees are experiencing.
The consumer price index (CPI) increased 0.4% on a seasonally adjusted basis in October, the U.S. Bureau of Labor Statistics (BLS) reported Nov. 10. That follows a 0.6% rise from September and is higher than the 0.3% rise expected by economists.
The report didn’t include an annual rate because of last year’s government shutdown.
The index for shelter rose 0.3% in October, accounting for more than 30% of the monthly all items increase, according to the BLS. The food index increased 0.5% in October, as the food at home index rose 0.4% and the food away from home index increased 0.5%. Gas prices are also still a major contributor: The index for energy increased 0.7% over the month, following a 5.2% jump in September.
Core inflation, which excludes volatile food and energy prices, increased 0.3% in October, as it did in September and August.
The inflation report comes as employers continue to grapple with persistent employee concerns about affordability. Employee financial confidence has fallen to its lowest level since 2012, according to MetLife, while financial literacy has also fallen to a 10-year low, according to a study by investment firm TIAA and Stanford University’s Global Financial Literacy Excellence Center.
Healthcare costs are also on the rise, with employees shouldering more of those increases — adding to employees’ financial stress. Annual premiums for employer-sponsored family health coverage have climbed to a record $28,303, according to KFF. On average, covered workers contributed $7,471 toward the cost of family coverage — up 9%, or $621, from 2025.
SHRM’s Civility Index, a measure of workplace incivility and the factors contributing to it, recently found that concerns about cost and affordability are now among the top five contributors for incivility in the workplace. More than a quarter of U.S. workers (27%) said cost and affordability concerns were contributors to the acts of incivility they experienced or witnessed in the workplace in Q2 2026.
“I think that anybody who’s been paying attention to the headlines is well aware that we’re experiencing an affordability crisis,” said Joy Awe, well-being manager at Insperity, an HR service and technology company in Kingwood, Texas.
For employers, the continued strain on household budgets underscores the importance of looking beyond nominal pay increases to understand whether employees are actually gaining financial ground. Workers’ paychecks increased at the same rate as consumer prices, according to separate BLS data.
Real average hourly earnings for all employees were unchanged from September to October, seasonally adjusted, the BLS reported separately Nov. 10. This result stems from an increase of 0.4% in average hourly earnings combined with an increase of 0.4% in the CPI.
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