Shoppers say a trip to the grocery store these days can lead to serious sticker shock

The U.S. Department of Labor on Thursday released data showing consumer prices increased 5% in May compared to one year ago.

Economists say one factor is pent-up demand as people emerge from pandemic restrictions and face supply shortages as companies try to ramp back up after shutdowns.

Shoppers say they've been noticing that a trip to the grocery store these days can lead to serious sticker shock.

"Just in this last week, I just noticed, especially with cereal. Cereal has really gone up," said Deborah Benko of Crockett.

Prices for corn and grains have hit a high not seen since 2012. Other food products are also seeing price increases.

"Sodas, beer, milk, and the meat products for sure," said Lisa Glieden of Martinez, "It's all adding up and we spend more and more every time."

"I have noticed the prices have gone up and it does put a pinch in things for sure," said Phil West a Martinez resident who was outside his neighborhood supermarket.

"Even the vegetables. I'm paying, you know, $3 to buy a package of lettuce. It's kind of difficult," said Chris Rowlan of Pacheco.

Companies such as Kimberly Clark and Proctor and Gamble that make other consumer goods such as diapers, tissues and toilet paper are raising prices to offset higher raw material costs such as wood pulp and plastics

At the Sigma Auto Group lot in Concord, the sales manager Phil Jimenez says it's been encouraging to see more customers shopping for vehicles after a difficult year of pandemic shutdowns. Jimenez says the company has seen a 35% increase in business in the past few months.

Nationwide, demand and prices for used vehicles surged a record 10% last month as supplies of new cars decreased due to a shortage of semiconductor chips.

"There has been a shortage of new cars out there recently due to the chips which have driven the pre-owned market up I'd say a pretty significant amount," said Jimenez.

As more people travel, airline fares have increased 7 percent. Gas prices also hit a 7-year high.

Restaurants such as Chipotle are increasing prices to offset higher wages of $15 an hour, being offered to employees. Other restaurants point to higher costs of ingredients.

"I look at...a 40-pound case of chicken went from about $40 to $130 in two weeks. That's food costs you can't deal with," said Ed Rensi, a former CEO of McDonald's.

U.S. Treasury Secretary Janet Yellen, however, says she expects the inflation will be temporary as the economy readjusts from the past year.

"We're making progress and while we're seeing some inflation, I don't believe its permanent, but we will watch this very carefully," said Yellen.

One thing that likely won't rise soon is interest rates.

Some economists are urging the Federal Reserve to raise interest rates to prevent inflation from skyrocketing.

For now, though, the Fed seems content to stay on its current course to avoid a recession and doesn't anticipate putting on brakes unless inflation rates rise continuously for many months.

Jana Katsuyama is a reporter for KTVU.  Email Jana at and follow her on Twitter @JanaKTVU or Facebook @NewsJana or