Financial Struggles Persist Despite Decreasing Inflation Rates

Mounika

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posted on 6 months ago — updated on 1 second ago

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In this ever-changing financial landscape, the paradox of falling inflation and rising expenses continues to perplex the Indian household. Despite the easing inflation, the average employee cost for listed companies has surged by a staggering 17.4% year-on-year in the June quarter of 2022-23. This economic turbulence is further exacerbated by the soaring costs in sectors crucial to the common man. The first half of the fiscal year has witnessed education inflation at 6.2%, alongside a sharp rise in healthcare costs. This seemingly contradictory scenario underscores the harsh reality of the Indian economy, where the easing inflation offers little respite to the common man grappling with spiralling expenses.

The easing inflation in India may not necessarily translate to relief for the common man. Despite a decrease in inflation rates, average expenses for Indian households have not shown any signs of relief.

A recent study indicates that in the June quarter of 2022-23, the average employee cost for listed companies increased by 17.4% year-on-year. This increase in employee costs is an indication of a rise in the cost of living, which directly affects the common man.

"The decrease in inflation does not necessarily mean a decrease in expenses. Cost of living continues to rise, and this is evident in the increase in the average employee cost," said Dr. Ravi Kumar, a senior economist at the Indian School of Business.

Furthermore, sector-specific inflation rates also provide a reason for concern. The average education inflation in the first half of this fiscal year was 6.2%, whereas the health inflation was 7.9%. This means that despite the overall easing of inflation, the cost of essential services like education and healthcare continues to rise.

Average Sector-Specific Inflation Rates
Sector	Inflation Rate
Education	6.2%
Healthcare	7.9%

These sector-specific inflation rates are a cause for concern, as they directly affect the common man's pocket. "The rising costs in the education and healthcare sectors are a huge burden for the average Indian household," added Dr. Kumar.

Economic experts suggest that this rise in expenses despite the easing inflation could be due to several factors. One of the primary reasons could be the increase in the global prices of commodities, which has led to increased costs for businesses. These costs are often passed on to the consumer, leading to an increase in expenses.

Another potential reason could be the increase in wages. As companies have had to increase their employee costs, they have had to raise their prices to maintain their profit margins. This has resulted in increased expenses for the consumer.

In conclusion, even though inflation may be easing, the common man in India continues to feel the pinch due to increased expenses. It's high time for the government to look into these sector-specific inflation rates and take action to provide relief for the common man.