Resources | Market Trends | October 13, 2022

5 Industries Critically Impacted by Rising Inflation

Wholesale trade, construction, and food and accommodations are among the industries feeling the pressure.

illustration of coins in jar with stack of money

Wholesale trade, construction, and food and accommodations are among the industries feeling the pressure.

Rising costs have touched practically every corner of the economy, raising expenses and forcing companies to increase their prices. But some industries have been impacted by inflation to a greater degree.

As part of this year’s Working Capital Survey, C2FO questioned CEOs, CFOs and other decision-makers in 10 countries about their financial outlook — including their forecasts about the impact of inflation on their companies. Specifically, they were asked if they planned to raise prices as a result of inflation and, if so, by how much. 

A majority of respondents in all industries said they were planning to raise prices, but there were five verticals that stood out in this year’s survey. 

Wholesale trade

Wholesale trade — aka the business of selling goods to other businesses and organizations — is a leading indicator of the overall economy. 

In this year’s Working Capital Survey, 77% of respondents in this industry expected to increase their prices. In fact, a total of 36% said they would increase prices by 6% or more, a sharper response than any other vertical in the survey. 

Some of that is due to higher wages and pent-up demand from the past few years. In July — the most recent month for which the Census Bureau has numbers for wholesale trade — the sector’s revenue numbers were up 15.3% year over year. 


From worker shortages to skyrocketing material costs, few sectors have been hit as hard as construction. 

About 75% of construction professionals said they planned to raise prices. 

About 14% expected an increase of 6% to 10%, while 13% planned a hike of 11% or more. No other industry had more respondents predicting a rise of 11% or higher. 

Part of that is due to the job market: This summer, 59% of small construction businesses said they had open job postings, the National Federation of Independent Business reported. But name a trend in the economy — higher materials costs, supply chain issues, housing shortages — and the construction field has been affected by it. 

That’s why commercial real estate firm CBRE is predicting a 14.1% increase in construction costs on a year-over-year basis by the end of 2022. The one silver lining? Cost increases should slow to 2% to 4% by 2023 and 2024. 

Accommodations and food

Ultimately, unlike other categories, people will always have to eat. They can downscale how much and change to less expensive alternatives, but there will always be a baseline of demand that won’t go away.

Overall, 74% of respondents in the accommodations and food industry expected to hike prices on customers. And it was one of the industries that expected to raise prices by a great degree: 21% predicted they would raise prices by 6% to 10%, while 9% said they would raise prices by more than 10%.  

And that’s holding up, according to the US Bureau of Labor Statistics. In August, grocery prices were up 13.5% over the previous year, while restaurant prices had increased by 8%. 

Several factors are driving the growth in food prices. Poultry has been sharply higher because of a worldwide outbreak of avian flu. Meanwhile, the Russia-Ukraine war has reduced the available supply of wheat and sunflower oil, among other crops. 

Overall, 74% of respondents in the accommodations and food industry expected to hike prices on customers.

Other services 

This includes service professionals who are not involved in health care, education, scientific, professional or technical services. About 74% of these respondents were expecting inflation-related price increases.

Increased demand and worker shortages, combined with calls for higher wages, have fueled inflationary pressures. 

According to the Institute for Supply Management, demand for services stayed solid in August even as hiring picked up (suggesting it’s now easier for service providers to find help) and prices paid by service providers declined (indicating that inflationary pressures might be easing somewhat). 

Transportation and warehousing

A total of 73% respondents in transportation and warehousing planned to raise their prices. About 23% planned to raise rates by 6% to 10%, one of the larger groups planning increases.

It makes sense that warehousing costs have spiked. For example, e-commerce, a key user of warehouses, grew 30% in 2020 and 23% in 2021. Meanwhile, more retailers have tried to boost their inventories to account for supply chain and shipping delays. As a result, warehouse vacancy rates are the lowest they’ve been in decades. 

How long will warehouse prices stay high? It’s possible that e-commerce growth may have peaked for now — it represented 13.9% of all retail in the second quarter of 2022, down from 16.4% two years earlier. And several developers are racing to build new space. But experts say that, realistically, it may take a few years before the supply-demand imbalance works itself out

As far as transportation, the cost of shipping spiked earlier this year as companies tried to both meet pent-up demand and build up inventory in case there were more shipping delays or COVID-19-related shutdowns. As a result, the cost of shipping goods soared.

But in recent months, rates have fallen — partly because many of the supply chain issues are working themselves out, partly because there’s less demand for shipments. Some experts warn this could be another sign of a coming recession

The bottom line

This year’s run of inflation has been the worst in decades, and you can see its effects in practically every industry. But there are also signs that pressures may be easing in some categories.

Related Content

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Forecasters Still Predict Economic Growth in 2024, but It Won’t Be as Strong

Developed economies will feel the slowdown more — and run a greater risk of recession. 

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