Spooky season is here, but Americans are feeling the strain of inflation as they prepare their holiday celebrations. Everyone loves the party game/icebreaker “two truths and a lie.” Can you identify which of the following is NOT true about Halloween inflation?
A. Tariffs are causing prices for candy to rise higher than in previous years.
B. People are skipping Halloween celebrations because it is too expensive for them.
C. Inflation-adjusted wages are rising
Let’s take these statements one at a time:
A. LIE! Despite President Trump instituting a multitude of tariffs since taking office, the prices of candy have risen only 8.1% since August 2024. This is a more modest increase compared to the 10.9% increase from 2021-2022 and 9.4% from 2022-2023. While tariffs have taken place, candy prices are not likely to be impacted as there are exemptions for food and drinks that cannot be sufficiently produced in the United States, such as cocoa used in chocolate in candy. Candy inflation cannot be blamed solely on tariffs.
B. TRUTH! A recent survey found that 19% of Americans are choosing not to celebrate Halloween. Seventy-two percent of people not celebrating say they are cutting back due to inflation. Although overall inflation is lower in 2025 than in previous years, price increases that have accumulated over the last four years are still affecting consumers. The remaining 81% of consumers still celebrating Halloween are expected to spend around $200 on things such as costumes, candy, parties, and decorations.
C. TRUTH! Inflation has increased 2.9% since August 2024, while the average hourly wage has increased 3.7% resulting in a 0.7% inflation-adjusted increase in average hourly earnings since August 2024. Although consumers are feeling the impact of years of out-of-control inflation, average hourly earnings have been on the rise for the last year, as average hourly earnings have risen faster than inflation. While rising wages help people suffering from rising costs, these higher wages do not affect all industries equally. For those changing jobs regularly or working hourly, wage increases will affect them faster than those working salaried jobs.
Bottom Line: U.S. consumers are seeing the cumulative effect of inflation over the last four years and are holding back from celebrations in order to save their budgets. While inflation only increased 2.9% and real earnings have increased 0.7% since August 2024, price increases still feel too unwieldy for Americans.