Some of those challenges, including widespread homelessness and the state’s high cost of living, were well established before Gov. Gavin Newsom took office. Others, including a persistent multibillion-dollar budget deficit and a high unemployment rate, have become more pressing in recent years.

For Southern California and the Inland Empire, where housing costs, long commutes and economic pressures are daily concerns for many families, the question is not just whether California is struggling, but how the state compares with the rest of the country.

Two recent academic studies offer a clearer picture — and the findings are mixed.

One report, “State of the States,” comes from a broader “State of the Nation” research project sponsored by Tulane University’s Murphy Institute. The project aims to assess major public policy issues across the country using comparable measures, rather than partisan talking points.

California ranked first in the nation on the economy, third on trust, third on mental health and third on children and families, according to the study. But the state landed near the bottom in several major categories: 48th in work and labor force, 49th in inequality and 50th in environment. The report also found California ranked low on educational achievement, volunteerism and press freedom.

Those rankings complicate the image often promoted by California political leaders, including Newsom, who have described the state as a national model for economic opportunity, social equity and environmental policy. While California’s economy remains among the strongest in the country, the benefits are not evenly shared, and the state’s high costs continue to weigh heavily on residents.

The report also compared California with neighboring Western states and found that California outperformed them in only three of 14 broad topic areas. Still, the study noted that the state is improving over time on nine of 31 specific measures.

Texas, a frequent point of comparison for California, fared better in several areas where California ranked poorly, including press freedom. But Texas also showed significant shortcomings, including on environmental measures and voter participation.

One striking difference involved how residents view their own lives. Texas ranked near the top for residents’ satisfaction with their current circumstances, while California fell well below the national median.

A second set of findings came from the Berkeley Economy & Society Initiative, a UC Berkeley project supported by the Hewlett Foundation. Its reports focused on California’s affordability crisis and concluded that the state is “less affordable and poorer than it should be” given the size and strength of its economy.

The UC Berkeley researchers found that California is consistently more expensive than other places with similar median incomes. They also linked high costs to the state’s shift from a long-standing magnet for newcomers to a place many residents are leaving.

Since the 2008 recession, California has experienced sustained domestic out-migration, meaning more residents have left for other states than have moved in from elsewhere in the country. Between 2020 and 2024, California had the second-lowest net migration rate among states as a share of population, behind only New York, according to the report.

The Berkeley researchers argued that unaffordability is a major factor behind that reversal.

A follow-up report examined the causes of California’s high costs and pointed to a policy environment that makes it difficult to build the infrastructure needed for housing, energy, water and other essentials.

The report said growth restrictions increase costs primarily by limiting housing supply and driving up housing prices. Those restrictions also raise the cost of major infrastructure projects, contributing to higher energy and transportation expenses for consumers.

Among the solutions identified by the researchers were broader use of factory-built housing and new financing models to expand affordable housing production.

Taken together, the two studies present a familiar but sobering portrait of California: a state with a powerful economy and major institutional strengths, but also deep inequality, severe affordability problems and weak results in several areas that affect everyday life.

For the next governor and state lawmakers, the findings suggest that improving California’s standing will require more than celebrating the state’s economic scale. It will mean confronting the cost pressures and policy barriers that continue to shape life for residents across the state, including fast-growing and cost-burdened communities throughout Southern California and the Inland Empire.

Original source: CalMatters

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The agency’s bimonthly report, based on metrics for western Riverside County and the cities of Ontario and San Bernardino, indicated that the Inland Empire’s Consumer Price Index was up exactly 1 percent.

BLS officials said Wednesday the principal driver behind the increase was retail gasoline prices, which jumped 11.6 percent between the beginning of April and the end of May. That in turn pushed the energy component of the CPI up 8.6 percent for the entire two-month period.

Prices went stratospheric as a result of the Mideast war.

Other contributors to the index’s upward trajectory were food prices and apparel costs, which advanced 1.5 percent and 3.3 percent, respectively.

Conversely, shelter costs — or property rents — trended marginally downward throughout the region in April and May, slipping 0.1 percent, and costs in the household furnishings category fell by 2.3 percent, according to the BLS.

Nationwide, the overall CPI registered a .5 percent increase for the month of May. The impetus, again, was energy costs. For the one-year period ending May 31, the national CPI was 4.2 percent.

In the Inland Empire, the year-over-year CPI was 3.4 percent, measuring a host of economic inputs from May 2025 to May 2026, data showed.

The most notable upward pressures in the annualized CPI were reflected in the energy and healthcare components of the regional index, moving up 20.9 percent and 5 percent, respectively.

The current rate of inflation reflects the price trajectory impacting most sectors of the economy.

Energy price shocks that began at the end of February are directly connected to commodities markets and oil trading, which turned bullish immediately after the joint Israel-U.S. military operations against Iran, beginning with a missile attack on a girls’ school, where almost 200 Iranians were killed. The nation’s supreme leader and multiple members of his family were also assassinated. Hostilities abated amid peace overtures in April and May but have recently resumed with intensity.

Iran declared a quasi closure of the Strait of Hormuz, where tankers carrying nearly one-fifth of the world’s energy supplies must pass. The U.S. Energy Information Administration has characterized the narrow Persian Gulf sea lane as a “chokepoint.”

Accelerating consumer price hikes have also been blamed on loose monetary policy and excessive federal spending, decaying the dollar’s purchasing power.

The national debt is now $39.2 trillion, according to the congressional Joint Economic Committee’s “Debt Dashboard.” Some projections indicate the debt load will almost double in 10 years or less.

Fortune magazine reported in April that federal payments just to cover interest on the debt total $88 billion a month.

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The latest bimonthly report, which tracks prices in western Riverside County as well as the cities of Ontario and San Bernardino, shows the region’s Consumer Price Index rose 0.8%. Officials pointed to a steep jump in gasoline prices as the primary factor behind the increase.

Gas prices surged roughly 30% between late February and the end of March, pushing the overall energy index up 15.4% during the same period. That spike alone accounted for most of the region’s inflation gains, underscoring how closely local costs remain tied to global energy markets.

Beyond fuel, modest increases were also recorded in other categories. Prices for general goods and services rose 2.2%, while recreation-related costs — including entertainment and theme park activities — climbed 3.2%.

There were, however, a few areas where consumers saw relief. Food prices, both at grocery stores and restaurants, dipped slightly across February and March, falling about 0.4%. Education-related expenses also declined, dropping 3.9%, according to the report.

On a broader scale, inflation trends in the Inland Empire largely mirrored what’s happening nationwide. The national Consumer Price Index rose 0.9% in March alone, again fueled by energy costs.

“The index for energy increased 10.9%, the largest monthly increase since September 2005,” the Bureau of Labor Statistics said in its report. “The gasoline index increased 21.2% over the month, the largest monthly increase since the series was first published in 1967.”

Looking at the longer-term picture, prices in the Inland Empire are up 3.1% compared to a year ago. Energy and healthcare costs have been among the biggest contributors to that increase, rising 13.4% and 5.9%, respectively.

Nationally, inflation stands at 3.3% over the same 12-month period.

Much of the recent pressure on energy prices can be traced back to geopolitical developments overseas. Escalating conflict involving Iran and disruptions in the Persian Gulf have rattled global oil markets. In particular, concerns over restricted access through the Strait of Hormuz — a key shipping route for roughly one-fifth of the world’s oil supply — have pushed prices higher.

Although a tentative ceasefire was announced earlier this week, oil markets remain volatile. U.S. benchmark crude is still trading just under $100 per barrel, reflecting ongoing uncertainty.

Economists also point to broader domestic factors contributing to inflation, including federal spending levels and monetary policy. The national debt currently stands at approximately $38.98 trillion, according to the Congressional Joint Economic Committee. Rising interest payments — now estimated at about $88 billion per month, based on recent reports — continue to add pressure to the overall economic outlook.

For Inland Empire residents, the immediate impact is clear: higher prices at the pump and across key sectors, even as some everyday expenses show slight signs of easing.

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It used to cost her around $25 to fill up her Toyota Corolla. She’s spent closer to $40 since the Iran war began and pushed up the average U.S. price for a gallon of regular gasoline by $1. Sherman-Shafer, a retired dental office assistant who picks up Uber passengers five days a week, said she’s putting in extra hours to cover the difference.

“We don’t get reimbursed for gas. We rely on the generosity of the tip,” Sherman-Shafer said. Some passengers have tipped more to compensate for higher gas prices, but most don’t tip at all, she said.

Driving a car, van or truck is a big part of many Americans’ workdays. Nearly 27% of civilian workers cited driving as a physical demand of their jobs last year, according to the U.S. Bureau of Labor Statistics. Millions of drivers use personal vehicles for their work, from delivery and ride-share providers like Sherman-Shafer to self-employed electricians, nannies, home health care aides and real estate agents.

As the war enters a fifth week and continues to disrupt global oil supplies. many of those workers are now scrambling to make ends meet. The national average price for gas reached $3.99 per gallon on Monday, up 34% from a month earlier, according to AAA.

“With everything going up, it’s impossible to save a dime,” Sherman-Shafer said.

Some companies compensate employees for using their own vehicles, including the cost of gas. In the U.S., the Internal Revenue Service sets a standard mileage rate every year that businesses and private contractors can use to calculate tax deductions. Alpine Maids, a housekeeping company based in Denver, pays cleaners the 2026 federal reimbursement rate of 72.5 cents per mile for the distance they drive to clients’ homes.

But with gas prices spiking, that money is not going as far, said Chris Willatt, a former geologist who now runs Alpine Maids.

“Our maids drive their own cars, so it’s kind of like their paycheck got smaller,” Willatt said. “They’re all upset.”

Willatt said he reduced how often maids must report to the office, from daily to once a week, and rejiggered cleaning assignments so employees aren’t driving as far between clients. If gas prices climb further, he said he might increase what he charges customers so he can pay workers more.

Molly Kenefick, the owner of Doggy Lama Pet Care Inc. in Oakland, California, said she recently raised her gas reimbursement rate to 80 cents per mile for 15 employees who use their own vehicles to pick up dogs and take them for hikes around the Bay Area. The rate increase will stay in place until gas prices in their area drop below $5 for at least a month, she said.

Kenefick said she planned to raise prices for the company’s services in May. But she doesn’t want to increase them too much because she’s worried she’ll lose clients. So Kenefick is also dipping into her savings to pay for gas.

“The economy is hard for people. Everybody’s under strain,” she said. “I can take some of the load and the company can take some of the load, provided this doesn’t go on too long.”

Ride-hailing and food delivery platforms that rely on gig workers don’t reimburse drivers for gas, but some are offering temporary incentives in response to rising gas prices. DoorDash, Uber, Lyft and Instacart are providing more than the usual cash back on gas purchases for drivers who use company-branded debit cards. DoorDash and Instacart are giving a weekly fuel payment to drivers who travel 125 miles or more making deliveries.

Sarah Noell, who spends about 20 hours a week making deliveries for DoorDash in Lynchburg, Virginia, said the measures help somewhat. But she said she’s noticed more customers declining to add tips to their orders as gas prices have increased.

Noell has started refusing any order that won’t average out to $1 per mile, including the $2.50 per order she gets from DoorDash. That cancels out many users who aren’t tipping or give only small tips.

“It takes nearly double the cost to fill my tank,” Noell said. “Ten dollars used to get me a decent amount. Now it only gets me 3 gallons.”

Owners of diesel-powered vehicles have seen even steeper fuel price increases since the war started on Feb. 28, affecting drivers around the world.

Drivers of diesel-powered “jeepneys” in the Philippines, went on strike for two days last week to protest their higher costs. In France, dozens of buses and trucks drove slowly on the Paris ring road Monday to demonstrate their concerns about rising diesel prices. Drivers and businesses want the French government to provide aid to mitigate the impact.

“The major difficulty right now is finding our balance on our business since we sold services with the vehicles at a certain price for diesel that was much cheaper. And we’re not going to ask customers to pay that difference,” Sarah Bahezre, manager of the bus transportation company Ulysse Cars, told The Associated Press.

Average U.S. diesel prices climbed 44% over the last month, according to AAA.

A few weeks ago, Rachel Hunter paid $3.62 a gallon to fill the single diesel truck used by Cactus Crew Junk Removal & Thrift Store, a Phoenix business she and her husband co-founded. The same fuel now costs $6.09 per gallon in Phoenix, according to AAA.

The truck carries all kinds of heavy cargo, from slabs of solid maple bowling lanes to loads of concrete paver tiles. So fuel costs quickly add up, Hunter said, particularly with a truck that only gets 12 or 13 miles to the gallon.

Hunter has started quoting prices that reflect the jump in prices. She worries she’s in a “vicious circle” that could hurt the business if oil prices remain high.

“We don’t want to get a bad name for being overpriced,” she says. “I’ll be able to explain it where people can understand, but it doesn’t mean they can afford it.”

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That is the body language of a man who knows how to wield a magic wand, and how to cast a spell. Trump is a wizard, a very powerful one, and he has magical powers. He will use his magic to make all these complicated issues disappear as soon as he is elected as our next president. We know his magic is very effective, because for the last decade or so, he has kept millions of people spellbound, worshipping him, thinking of him as a divine being, doing whatever he’s commanded them to do, even committing crimes in his name. He has made them drink the Kool-Aid and show unquestioning obedience to him. A whole party has disgraced itself in his loyalty. Some of the smartest and most intelligent politicians have ruined their own legacies to propagate his lies and to defend his most indefensible acts. Even hardcore Christians have ignored the teachings of the Bible, just to kiss his behind, in a totally hypocritical way. All those people tolerating his morally, spiritually, ethically, and legally bankrupt actions, must be under a spell. Otherwise, they’ll see right through his crimes against this nation.

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The national unemployment rate stands at 3.9%, substantially lower than California’s. However, the 1.4% gap between the national and state rate is in line with historical averages, meaning that while it is unusual to find California as the leader of the pack, it is quite common to place it in the top three or so. This may be attributed in part to differences in industrial composition between the economies and socio-economic factors. Ignore differences in seasonal factors since the data we focus on is reported with typical seasonal fluctuations filtered out.

Unemployment rates also vary widely across the state. Of the 58 counties within California, the highest unemployment rates are in Colusa County (20.4%) and Imperial County (17.2%), the latter typically having the highest rate among the regions of the country. Both Riverside County and San Bernardino County, which make up the Riverside-San Bernardino-Ontario Metropolitan Statistical Area or the Inland Empire, are in the middle of the pack in 22nd and 20th place with rates of 5.6% and 5.4%, respectively. These rates are higher than a year ago.

So, how bad is bad? Ranking states and regions from top to bottom is interesting, especially since it typically results in political statements that focus on such extremes. However, from an economic point of view, it is more important to understand the “why” not the “what.”

Unemployment rates are determined by dividing the number of unemployed persons by the labor force, which is made up of both the employed and unemployed.  The unemployment rate falls if employment growth is positive as long as the labor force does not grow. In fact, it will fall as long as employment growth outpaces the labor force growth. On the other hand, the unemployment rate will go up even if employment does not fall or even grows, as long as the labor force increases by more. In general, employment growth outpacing labor force growth is a sign of a relatively healthy economy,  but when both the labor force and employment shrink, the economy is slowing or contracting, even if the unemployment rate falls. This is not healthy. In California’s case, recent weak employment growth stands out.

Let’s look at the Inland Empire.

At 5.5%, the unemployment rate for the Inland Empire is up by 1.1 percentage points from February 2023. It is also 1.6 percentage points higher than in February 2020 (3.9%), the month preceding the start of the pandemic. That does not sound good, but the explanation is that our labor force increased by 65,000 people – perhaps because more discouraged workers have decided to look for work again or because of outmigration from the coastal areas – while employment is 27,000 workers higher. Taken together, these figures paint a picture of a growing economy even as the unemployment rate has increased. Moreover, employment increased despite the recent and highly publicized job losses in the logistics (transportation, warehousing, wholesale) sector, meaning that growth in other sectors is offsetting the momentum lost as the logistics sector slows.

The story is different elsewhere in Southern California.

Los Angeles County has the worst record. It experienced a large employment decline of 6%. Had the labor force not shrunk by roughly the same amount (5%), then the unemployment rate of Los Angeles County would have increased by that number, and would now stand at 11.3% instead of the seemingly normal 5.0%. It was “saved” by a combination of outmigration and people quitting the labor force. Orange County and Ventura County did slightly better but also ended up with lower employment and a shrinking labor force.

So what is the situation in California?

The labor force is still 1% below its February 2020 level while employment is 2% lower than its pre-pandemic level. In absolute numbers, employment is lower by 410,000 and the labor force is 243,000 or close to a quarter of a million smaller compared to just before the pandemic. California’s unemployment rate is 5.3% now, compared to  4.4% in February 2020. Like Los Angeles County, the state’s labor market has been adversely affected in recent years by a shrinking labor force, due to people retiring or otherwise leaving the labor force, and outmigration, as reflected in population numbers of the past few years.

What do we make of all of this?

Neither the state nor coastal Southern California have fully recovered from the pandemic, but the Inland Empire has. Employment across the state and its regions should pick up this year as leading sectors such as logistics, tech, and entertainment experience employment growth. And let’s face it, neither one of us is going to move to South Dakota, just because you can tour the Badlands and visit Mount Rushmore every weekend. Last time one of us considered visiting there, he could not find a four-star hotel in the capital (we challenge you to remember the name — no cheating, do not google it; and no, it is not Bismarck).

Meanwhile, having recovered all employment lost since the start of the COVID-19 downturn, and showing a growing labor force, the Inland Empire is doing relatively well. While its unemployment rate is elevated, this is simply a function of more people moving into our region and not all, so far, being able to find a job.

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WASHINGTON (AP) — Federal Reserve officials regarded the U.S. economy’s outlook as particularly uncertain last month, according to minutes released Wednesday, and said they would “proceed carefully” in deciding whether to further raise their benchmark interest rate.

Such cautious views are generally seen as evidence that the Fed isn’t necessarily inclined to raise rates in the near future. Their next meeting is in three weeks.

Economic data from the past several months “generally suggested that inflation was slowing,” the minutes of the Sept. 19-20 meeting said. The policymakers added that further evidence of declining inflation was needed to be sure it would slow to the Fed’s 2% target.

Several of the 19 policymakers said that with the Fed’s key rate “likely at or near its peak, the focus” of their policy decisions should “shift from how high to raise the policy rate to how long” to keep it at economically restrictive levels.

And the officials generally acknowledged that the risks to Fed’s policies were becoming more balanced between raising rates too high and hurting the economy and not raising them enough to curb inflation. For most of the past two years, the Fed had said the risks were heavily tilted toward not raising rates enough.

Given the uncertainty surrounding the economy, the Fed left its key short-term rate unchanged at 5.4% at its September meeting, the highest level in 22 years, after 11 rates hikes over the previous 18 months.

The officials noted several sources of uncertainty. They include the strike by the United Auto Workers union against Detroit automakers; higher oil and gas prices; concern that an economically weaker China would slow growth in the United States; and the threat of an extended U.S. government shutdown. Since the September meeting, two of those threats have abated: Oil and gas prices have dropped. And a government shutdown has been avoided, at least until mid-November.

The minutes arrive in a week in which several Fed officials have suggested that a jump in longer-term bond rates could help cool the economy and inflation in the coming months. As a result, the Fed may be able to avoid a rate hike at its next two-day meeting, which ends Nov. 1. Futures markets prices show few investors expect a rate increase at that meeting or at the next one in December.

Overall inflation, as measured year over year, has dropped from a peak of 9.1% in June 2022 to 3.7% in August. The latest data on consumer price changes will be released Thursday, and economists expect it to show that annual inflation ticked down in September to 3.6%.

On Wednesday, Christopher Waller, an influential member of the Fed’s governing board, suggested that higher long-term bond rates, by making many loans costlier for consumers and businesses, are doing “some of the work for us” in fighting inflation. Waller also underscored the Fed’s cautious approach in his remarks in Park City, Utah, during a question-and-answer session.

“We’re in this position where we can kind of watch and see what happens,” Waller said.

But he also expressed more optimism about inflation than he has in the past, noting that the past three months of price changes, according to the Fed’s preferred measure, have been “very good.”

“If this continues,” Waller said, “we’re pretty much back to our target.”

At their meeting last month, Fed officials issued an optimistic set of projections that envisioned inflation falling over the next two years, with only a small increase in unemployment and modest economic growth. The forecast raised the prospect of a “soft landing” in which inflation would slow to the Fed’s 2% target without causing a deep recession.

Yet the projections also showed that the policymakers expected to keep their benchmark rate elevated well into 2024 to keep the economy from sending inflation up again. They showed that Fed officials expected to cut rates only twice next year. Previously, they had penciled in four rate cuts.

“We’re fairly close, we think, to where we need to get,” Chair Jerome Powell said at a news conference after the September meeting. “A soft landing is a primary objective. … That’s what we’ve been trying to achieve.”

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WASHINGTON (AP) — President Joe Biden has devoted the past several weeks to promoting the positive impacts of his policies — but his efforts have yet to meaningfully register with the public.

Only 36% of U.S. adults approve of Biden’s handling of the economy, slightly lower than the 42% who approve of his overall performance, according to the new poll from The Associated Press-NORC Center for Public Affairs Research.

Both figures are close to where Biden’s approval numbers have stood for about the past year and a half, including just two months ago. Signs of an improving economic outlook have done little to sway how people feel about the Democratic president as he gears up for a 2024 reelection campaign that could pit him against his predecessor and 2020 opponent, Republican Donald Trump.

Job growth has stayed solid with the unemployment rate at 3.5%, while the pace of inflation has slowed sharply over the past year to the annual rate of 3.2%.

Both Biden and Trump have weaknesses as older candidates seeking a rematch. Trump, 77, faces a series of criminal indictments that include his possession of classified material and allegations that he tried to overturn the 2020 election, which has rallied support among Republicans while leaving him with substantial vulnerabilities in a potential general election contest.

Biden, 80, has yet to fully bring Democrats to his side as the lingering aftershocks of inflation still weigh on people’s minds. Along with members of his cabinet and Vice President Kamala Harris, Biden has been speaking about the $500 billion worth of new investments by private companies that he said came from incentives he signed into law.

Erica Basile, a teacher who describes herself as a “staunch Democrat,” said she feels the economy is “mediocre, but improving.”

“I do think in many ways they’re working very hard at getting the economy back on track post-COVID,” said Basile, who lives in Lynnwood, Washington.

Just 65% of Democrats approve of Biden’s economic leadership, while 76% approve of how he’s handling the job overall.

In follow-up interviews, some survey respondents felt torn between the desire to return to a sense of normalcy after Trump’s presidency and the desire for even more sweeping policies to address climate change, health care costs and taxes.

“When Joe Biden was selected to be the nominee and eventually won, my feeling at the time was that he could be the most milquetoast and undramatic president to help the country cool down,” said Steven Peters, 41, who works in information technology in White House, Tennessee. “Unfortunately, that’s what he’s been. I’m dissatisfied because I had hoped there would be more change.”

Peters added, “He’s really middle of the road when a lot of people would like to see more dramatic action.”

For GOP supporters, such as Merritt Rahn, 74, Biden has gone too far. Rahn said he is retired but also works at Home Depot and sees higher gasoline and food costs as making it harder for families to get by financially. The Jensen Beach, Florida, resident said Biden will further hurt the U.S. by moving energy sources away from oil and gas.

“It’s a death to our society and economy,” said Rahn, who added that he believes Biden “has no clue what’s going on.”

The poll also found that 55% of Democrats say they don’t think Biden should run again in 2024, though a large majority — 82% — say they would definitely or probably support him if he is the nominee. Overall, only 24% of Americans say they want Biden to run again.

Among Democrats who approve of how Biden is handling the economy, 58% would like him to seek another term. Just 20% of those who disapprove of his performance on the issue want the incumbent president to run again.

Biden continues to struggle to appeal to younger Democrats, especially on the economy. Only 52% of Democrats under age 45 say they approve of his handling of the economy, compared with 77% of those older.

The president has used the term “Bidenomics” to try to encompass his ideas to lower costs for people on Medicare, shift toward electric vehicles and renewable energy, and build factories for advanced computer chips and batteries. Yet some are still struggling to understand what the term means.

Asked about the definition of Bidenomics, Cory O’Brien, 39, said: “You know what, dude, I have no idea. Biden is a free market capitalist like most moderate Democrats are.”

The age gap extends to Biden’s reelection campaign: Just 34% of Democrats under 45 want him to run again, compared with 54% of those older than that. Still, about three-quarters of younger Democrats say they’ll most likely support him if he’s the nominee, though only 28% say they definitely will.

O’Brien, who works in education and lives in Massachusetts, said he expects the 2024 election to be “miserable” for voters because of the likely Biden and Trump rematch.

“I think it’s going to be a miserable election cycle,” he said. “We’re going to see a lot of the same stuff that we saw in 2020.”

Biden also faces renewed pressure related to investigations over his son Hunter’s business dealings. The poll finds that a majority of Americans — 58% — have hardly any confidence in Biden to reduce corruption in government, though that’s unchanged since January. Another 30% have some confidence and 10% have have a great deal of confidence.

The poll shows that 23% of Americans say they have a great deal of confidence in Biden’s ability to effectively manage the White House, 31% have some confidence and 45% have hardly any. Despite the fact that Biden has achieved several of his major policy goals, just 16% say they have high confidence in his ability to do that, while 38% say they have some confidence and 44% hardly any.

Few Americans say they think the national economy is doing well: 34% describe it as very or somewhat good. No more than about a third of Americans have called the economy good since 2021.

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WASHINGTON (AP) — Over the past year, inflation in the United States has tumbled from 9% all the way to 3%, softening most of the price pressures that have gripped the nation for more than two years.

Now comes the hard part.

Squeezing out the last bit of excess inflation and reducing it to the Federal Reserve’s 2% target rate is expected to be a much harder and slower grind.

A measure called “core” inflation, which excludes volatile food and energy prices, is even higher than overall inflation. It, too, seems likely to slow only gradually. The Fed pays particular attention to core prices as a signal of where inflation might be headed. In June, core prices were up 4.1% from a year earlier, according to the Fed’s preferred gauge.

“We see some challenges in getting that all the way back to 2% quickly,” said Michael Hanson, senior global economist at J.P. Morgan.

The stickiness of inflation could endanger the possibility that the Fed will achieve a rare “soft landing” — a scenario in which it manages to slow inflation down to its target level through higher interest rates without derailing the economy. If inflation were to remain elevated for too long, the Fed might feel compelled to further raise its key rate from its current 5.4%, a 22-year high. Most economists say they think the central bank is done hiking, but only if inflation continues to cool.

At the same time, the Fed has acknowledged that inflation pressures have eased significantly over the past year. Encouragingly, that slowdown has occurred even while the economy has continued to expand and employers have steadily hired at a healthy pace.

On Thursday, when the government will issue inflation data for July, economists expect it to show a slight pickup in year-over-year inflation to 3.3%. It would be the first such increase after 12 months of declines.

In part, any rebound in annual inflation for July will reflect higher gas prices. Unless they ease, gas prices could keep overall inflation above 3% through the end of the year. The national average pump price has jumped about 30 cents, to $3.83, in the past month, partly because the cost of oil has risen.

One obstacle in bringing inflation down to the Fed’s 2% target is that the price slowdown so far has reflected mainly relatively painless changes not likely to be repeated. Until last month, for example, gas prices had already plunged from a peak national average of $5. And supply-chain snarls that had swollen the prices of cars, furniture, appliances and other physical goods have mostly unwound. The cost of long-lasting manufactured goods actually declined slightly in June from a year ago.

Another factor is that prices had soared in the first half of 2022 before slowing in the second half. So any increase in July would have the effect of boosting the year-over-year inflation rate.

What’s now sending prices up is mostly the cost of services — everything from dental care and auto insurance to restaurant meals and summer concerts. Those costs mostly reflect healthy wage gains for workers, which are often passed on to customers in the form of higher prices.

“Energy prices are off, commodity prices off, core goods fell,” said Kristin Forbes, an economist at MIT and a former member of the Bank of England’s interest-rate setting committee. “That’s the quick, easy stuff. What’s left is this underlying wage-service inflation. And that’s the part that’s harder to slow down and will take take longer.”

Many employees, especially in the economy’s service sector, could push for further raises in the coming months. With labor shortages still a problem for service industries, workers have leverage to demand higher pay. For most Americans, pay gains have trailed inflation over the past two years.

Higher pay is one key issue driving strikes among Hollywood writers and actors. It was also a focus of the Teamsters union in its negotiations with UPS, which led to large pay gains. The United Auto Workers is also pushing for robust raises in its talks with U.S. automakers.

Hanson, of J.P. Morgan, notes that measures of health insurance costs will start to rise this fall because of quirks in how the government measures them. And auto insurance and repair costs have been surging. A key reason is that vehicle prices soared after parts shortages developed when the pandemic erupted; costlier cars are more expensive to fix and insure. Auto insurance prices have soared nearly 17% in the past year.

As a result, economists generally expect core prices, under the Fed’s preferred measure, to still rise at a 3.5% annual pace by year’s end — far above its 2% target. The Fed’s latest forecasts show that its policymakers expect core inflation to still be 2.6% at the end of 2024.

Still, there are some hopeful signs that hiring and wages are slowing, which would cool inflation over time. On Friday, the government reported that employers added 187,000 jobs in July, a solid total but still reflective of a slowdown: Job growth over the past three months has averaged only about half the pace of the same period in 2022. And wage growth slipped to 4.6% in the April-June quarter, the government said, the slowest pace in a year and a half.

“That trajectory tells us where things will go in the next 12 months,” said Skanda Amarnath, executive director of Employ America, an advocacy group.

At his most recent news conference, Fed Chair Jerome Powell sounded some cautious but hopeful notes about the prospect of a soft landing.

“I wouldn’t use the term optimism about this yet,” he said. “I would say though that there’s a pathway….We’ve seen so far the beginnings of disinflation without any real costs in the labor market. And that’s a really good thing.”

Yet a defining characteristic of the post-pandemic economy has been resilience, with consumers in particular showing a surprisingly persistent willingness to spend. Some economists worry that it will take a sharp rise in unemployment to reverse that trend and finally conquer inflation.

The Fed has already been coming under some criticism for sharply raising rates and potentially putting the job market at risk. Sen. Elizabeth Warren, a Massachusetts Democrat, wrote Powell before the Fed met last month and urged him to forgo another rate increase. The central bank, though, went ahead with its 11th rate hike since March 2022.

“The Fed’s aggressive rate hikes disproportionately threaten Black workers and their families and risk fully reversing the extraordinary labor market gains we have seen,” Warren, a frequent Fed critic, wrote.

With political pressure on the Fed rising, Powell and other officials may soon see the precipitous drop in inflation in the first half of this year as having been the easy part.

“The Fed has got lucky so far in what it’s gotten,” said Steven Blitz, chief U.S. economist at GlobalData TS Lombard. “Most of the decline in inflation was going to happen anyway. They really own the part that’s to come.”

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WASHINGTON (AP) — Squeezed by painfully high prices for two years, Americans have gained some much-needed relief with inflation reaching its lowest point since early 2021 — 3% in June compared with a year earlier — thanks in part to easing prices for gasoline, airline fares, used cars and groceries.

The inflation figure the government reported Wednesday was down sharply from a 4% annual rate in May, though still above the Federal Reserve’s 2% target. From May to June, overall prices rose 0.2%, up from just 0.1% in the previous month but still comparatively mild.

Even with Wednesday’s better-than-expected inflation data, the Fed is considered all but sure to raise its benchmark rate when it meets in two weeks. But with price increases slowing — or even falling outright — across a range of goods and services, many economists say they think the central bank could hold off on what had been expected to be another rate hike in September, should inflation continue to cool.

“It takes the second hike off the table, if that trend continues,” said Laura Rosner-Warburton, senior economist at MacroPolicy Perspectives. “They’re probably on hold for the rest of the year.”

On Wall Street, investors cheered the encouraging news, sending stock and bond prices higher. Investors have been eagerly anticipating the eventual end of the central bank’s rate increases.

The Fed has raised its benchmark rate by a substantial 5 percentage points since March 2022, the steepest pace of increases in four decades. Its expected hike this month will follow the central bank’s decision to pause its rate increases last month after 10 consecutive hikes.

Wednesday’s inflation data may lift hopes that the Fed will achieve a difficult “soft landing,” in which price increases fall back to 2% without causing a spike in unemployment or a deep recession. Last week, the government reported solid hiring in June, though it slowed compared with earlier this year. The unemployment rate ticked lower, from 3.7% to 3.6%, near a half-century low.

When the Fed began raising its key rate a year ago, many economists expected that unemployment would have to rise significantly to curb inflation. Though inflation isn’t yet fully tamed, some economists say they think it can fall to a level near the Fed’s 2% target earlier than they had expected.

Excluding the volatile food and energy prices, so-called core inflation was lower last month than economists had expected, rising just 0.2% from May to June, the smallest monthly increase in nearly two years. Compared with a year ago, core inflation does remain relatively high, at 4.8%, but down from a 5.3% annual rate in May.

In just the past two months, overall inflation, measured year over year, has slowed from nearly 5% in April to just 3% now. Much of that progress reflects the fading of spikes in food and energy prices that followed Russia’s invasion of Ukraine last spring. Inflation is now significantly below its peak of 9.1% in June 2022.

Gas prices have fallen to about $3.54 a gallon on average, nationally, down from a $5 peak last year. Grocery prices have leveled off in the past three months and were unchanged from May to June. Milk prices, having dropped for a third straight month, are down 1.9% from last year.

Eggs, which had skyrocketed last year after an outbreak of avian flu decimated chicken flocks, have dropped to $2.22 a dozen — down more than 7% just in the past month. Egg prices had peaked at $4.82 in January, according to government data. Still, they remain above the average pre-pandemic price of about $1.60 a dozen.

Economists say inflation isn’t likely to keep falling at such a rapid pace. On a 12-month basis, inflation could even tick up in the coming months now that big drops in gas prices — they’re down 27% in the past year — have been achieved..

In particular, airfares plunged 8.1% just from May to June, hotel costs 2% and car rental prices 1.4% — sharp drops that aren’t likely to be replicated.

And the cost of some services are still rising and likely to stay high this year, potentially keeping core prices elevated. Auto insurance costs, for instance, have soared, and are up 16.9% from a year ago. Americans are driving more than during the pandemic and causing more accidents. Insurance is also costlier because vehicle prices are much higher than before the pandemic, and cars are therefore more valuable.

Restaurant prices are still moving up, having risen 0.4% from May to June and nearly 8% from a year earlier. Restaurant owners have had to keep raising wages to find and retain workers, and many of them are passing their higher labor costs on to their customers by raising prices.

Chrishon Lampley, owner of the wine brand Love Cork Screw, says more expensive restaurant prices have led her to cut back on taking prospective customers out for meals. Instead, she gives potential wine buyers small gifts.

The cost of printing labels for her wine bottles has nearly doubled in the past year, Lampley said, mostly because of higher labor costs. She’s reduced her travel costs as a result. Lampley now chooses extended-stay hotels with kitchens rather than regular hotels, and she rents smaller cars even though she often carts around cases of wine.

“Everything has just become way more frugal,” she said. “I’ve got to pull back.”

Chair Jerome Powell and other Fed officials have focused their attention, in particular, on chronically high inflation for restaurant meals, auto insurance and other items in the economy’s sprawling service sector. It’s a big reason why several Fed policymakers were still talking earlier this week about the likelihood of two more rate hikes.

“We’re likely to need a couple more rate hikes over the course of this year to really bring inflation back into … a sustainable 2% path,” Mary Daly, president of the Federal Reserve Bank of San Francisco, said on Monday.

At the same time, Daly said she was “holding myself to … extreme data dependence” and could shift her thinking based on incoming reports. There will be two more inflation reports — for July and August — before the Fed meets in September.

Some drivers of higher prices are likely to keep fading and pull down inflation in the coming months. Used car prices sank 0.5% from May to June, after two months of big spikes. New-car prices, too, have begun to ease as a result, and were unchanged from May to June.

In June, used vehicle prices paid by dealers were down 5.6% from a year earlier, helping to cool inflation, according to data gathered by Black Book, which monitors prices. But used vehicles are still comparatively pricey: Dealers are paying almost 70% more for them than in June 2019, before the pandemic began. The average list price offered by dealers to consumers was $28,850 last month.

Alex Yurchenko, chief data officer for Black Book, said he expects prices paid by consumers to keep falling through year’s end, contributing to declining inflation. But they aren’t expected to drop dramatically. Typically, prices fall in the second half of the year, then rise in the spring as the car-buying season begins.

“We expect a return to some kind of normality,” Yurchenko said.

Supplies of new vehicles are rising, and prices are dropping slightly. As a global shortage of computer chips wanes, automakers have accelerated production. New-vehicle prices peaked in December but fell 3% to $45,978 last month, according to estimates from J.D. Power.

And rental costs, a huge driver of inflation, are expected to keep declining, as builders continue to complete the most new apartment units in decades. Rising housing costs have driven more than two-thirds of the increase in core inflation in the past year, the government said, so as that increase fade it should steadily lower overall inflation.

Prices first spiked two years ago as consumers ramped up their spending on items like exercise bikes, standing desks and new patio furniture, fueled by three rounds of stimulus checks. The jump in consumer demand overwhelmed supply chains and ignited inflation.

Many economists have suggested that President Joe Biden’s stimulus package in March 2021 intensified the inflation surge. At the same time, though, inflation also jumped overseas, even in countries where much less stimulus was put in place.

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