American consumers are stressed. You can blame the high prices seen in the economy right now.
In an interview with CNBC on Tuesday, Walmart CEO Doug McMillon said customers started to become more budget-conscious this spring, as inflation began to take some big bites out of their finances, and that pricing pressures are still a challenge as the winter holidays approach.
McMillon said things are getting better. Some might look and say things are getting better. He said that prices are not coming down for many families, but just stabilizing at a higher level.
In October, price growth in the U.S. slowed but at 7.8% it remains near four-decade highs. Asked whether a recession would be preferable to the current inflation environment, McMillon responded: "Our focus is on serving these customers, and there are many of them that need some help as it relates to inflation, so that's our focus." There's a focus on groceries, part of that focus is on groceries, according to McMillon. The cost of chicken remains high even though beef and produce prices are coming down a bit. McMillon said he expects to see double-digit inflation rates around for a while for dry foods. Rising wages for cashiers and the cost of dealing with theft are two factors that cause prices to go up at Walmart stores. While the company has been able to fill most of its roles, pressure at cashier levels is leading to higher pay. The average hourly wage for U.S. front-line associates is now more than $17, according to Walmart's website.
McMillon said that the industry has seen shrinkage at stores and has risen above historical averages. He urged state and local law enforcement to beef up their prosecution of theft incidents.
If that is not corrected, prices will be higher and stores will close, according to McMillon.