Midwest Information Office

For release: 8:30 A.M. ET, Friday, January 15, 2010
BLSInfoChicago@bls.gov
General Information: (312) 353-1880
Media Contact: Paul LaPorte (312) 353-1138

---

CONSUMER PRICE INDEX, DETROIT-ANN ARBOR-FLINT, MICH. CMSA DECEMBER 2009

 

The Detroit-Ann Arbor-Flint Consumer Price Index for All Urban Consumers (CPI-U) fell 0.6 percent from October to December, according to a report issued today by the U.S. Bureau of Labor Statistics. The December 2009 all items CPI-U for the Detroit area was 203.880 (1982-84=100), 3.0 percent above its year ago level. In the previous annual period (December 2007-08), the Detroit area CPI-U decreased 1.1 percent.

Jay A. Mousa, regional commissioner for the Bureau in Chicago, stated that declines in the components for recreation, apparel, and housing were responsible for the two-month drop in the Detroit-area all items CPI-U. Costs for transportation and food and beverages rose from October-December, only partially offsetting these declines. The components for other goods and services, education and communication, and medical care experienced either little or no change during the two-month period.

Recreation prices in the Detroit area fell 6.9 percent from October to December. Lower costs for televisions, newspapers and magazines, and recreation services contributed to this decline. Over the year, the recreation component, which also includes items like sporting goods and pet products, fell 9.3 percent. During the previous 12-month period, the area’s recreation component declined 0.4 percent.

A 5.9-percent drop in the apparel component also contributed to the area’s overall decrease in retail prices from October to December. The apparel index is subject to large seasonal fluctuations and the recent decrease compares with the 7.9 percent decline during the same two-month period in 2008. Over the year, apparel prices were up 5.3 percent after decreasing 1.3 percent during the previous 12-month period.

Housing, the area’s most heavily-weighted component in the all items index, experienced a 0.4 percent decline from October to December. Shelter, the component of the housing index that includes rents and owner’s equivalent rents, also fell 0.4 percent over the two-month period. Household energy, which primarily consists of electricity and utility (piped) gas service, was essentially unchanged from October to December. Over the year, the housing component in the Detroit area decreased a modest 0.2 percent. Shelter costs fell 0.8 percent for the year while household energy prices rose 3.9 percent from their December 2008 level.

The other goods and services component was essentially unchanged (-0.1 percent) during this bimonthly period. This component includes items such as tobacco, haircuts, and legal services. On an annual basis this component rose 8.3 percent after decreasing 0.8 percent during the previous December to December period.

The education and communication component was unchanged from October to December. During the same period in 2007 and in 2008, this component experienced little movement (-0.1 percent). On an annual basis, the component gained 2.1 percent. This was close to the 1.8 percent increase in the prior twelve-month period.

Medical care costs were essentially unchanged for both the two-month period (+0.1 percent) and for the year (-0.1 percent). In the previous 12-month period, costs for medical care were down 0.8 percent.

The food and beverages component rose 0.3 percent from October to December. A 1.0-percent increase in the food at home index contributed to this gain. Prices for food away from home were nearly unchanged (-0.1 percent) while alcoholic beverages prices were down 2.6 percent from October-December. Over the past year, the food and beverages component in the Detroit area was unchanged. An annual increase in the index for food away from home (1.5 percent) was enough to offset the annual decreases in food at home (-1.2 percent) and alcoholic beverages (-0.2 percent). During the previous 12-month period, the food and beverages component rose 4.1 percent.

The transportation component was up 0.7 percent from October to December due to a 2.6 percent rise in prices for gasoline. Price increases for new and used vehicles also contributed to the two-month gain. Over the past 12 months, gasoline prices in the Detroit area jumped 55.4 percent, moving overall transportation costs up 17.4 percent for the year.

 

 

---

 

###

Scheduled release date for the January 2010 CPI: Friday, February 19, 2010

Detroit-Ann Arbor-Flint, Mich. Combined Metropolitan Statistical Area (CMSA) includes Genesee, Lapeer, Lenawee, Livingston, Macomb, Monroe, Oakland, St. Clair, Washtenaw, and Wayne Counties in Michigan.

 

BRIEF EXPLANATION OF THE CPI

The Consumer Price Index (CPI) is a measure of the average change in prices over time in a fixed market basket of goods and services. The Bureau of Labor Statistics publishes CPIs for two population groups: (1) a CPI for All Urban Consumers (CPI-U) which covers approximately 87 percent of the total population and (2) a CPI for Urban Wage Earners and Clerical Workers (CPI-W) which covers 32 percent of the total population. The CPI-U includes, in addition to wage earners and clerical workers, groups such as professional, managerial, and technical workers, the self-employed, short-term workers, the unemployed, and retirees and others not in the labor force.

The CPI is based on prices of food, clothing, shelter, and fuels, transportation fares, charges for doctors' and dentists' services, drugs, and the other goods and services that people buy for day-to-day living. Prices are collected in 87 urban areas across the country from about 50,000 housing units and approximately 23,000 retail establishments--department stores, supermarkets, hospitals, filling stations, and other types of stores and service establishments. All taxes directly associated with the purchase and use of items are included in the index. Prices of food, fuels, and a few other items are obtained every month in all 87 locations. Prices of most other commodities and services are collected every month in the three largest geographic areas and every other month in other areas. Prices of most goods and services are obtained by personal visits of the Bureau's trained representatives.

In calculating the index, price changes for the various items in each location are averaged together with weights that represent their importance in the spending of the appropriate population group. Local data are then combined to obtain a U.S. city average. Separate indexes are also published by size of city, by region of the country, for cross-classifications of regions and population-size classes, and for 27 local areas. Area indexes do not measure differences in the level of prices among cities; they only measure the average change in prices for each area since the base period.

The index measures price changes from a designated reference date (1982-84) that equals 100.0. An increase of 16.5 percent, for example, is shown as 116.5. This change can also be expressed in dollars as follows: the price of a base period "market basket" of goods and services in the CPI has risen from $10 in 1982-84 to $11.65.

For further details see the CPI home page on the Internet at www.bls.gov/cpi and the BLS Handbook of Methods, Chapter 17, The Consumer Price Index, available on the Internet at www.bls.gov/opub/hom/homch17_a.htm.

 

Last Modified Date: January 15, 2010