As the nation heads into the Christmas season, fears are mounting that massive inflation and ongoing supply chain issues will make this holiday one of the most expensive in memory.
Luca Pautasso, a New York-based financial services provider, told Fox Business that public spending and a shortage of goods have created the "perfect storm."
"It’s going to be a tough Christmas," he said. "Many projections say that this is going to be the most expensive … Christmas in the last 30 years."
He noted that although many Americans have seen their paychecks increase, it is still not enough to fight against the huge rates of inflation the country is facing. But it remains to be seen exactly how Americans will adapt to this climate, he said.
"It will be hard to keep the same pace of spending … but people are going to still try to outdo the Christmas they're used to," he said.
Much of the anticipated shortages originate with the global supply chain crisis, which is affecting the price of virtually everything from the food on our plates to raw and packaging materials.
Jennifer Blackhurst, a professor of business analytics at the University of Iowa Tippie College of Business and a global supply chain expert, cautioned that "panic buying" as was done at the height of the COVID-19 pandemic is the wrong approach and will make matters worse in the long run.
"The more we have this panic buying now, the bigger that’s going to cause the shortage and the problems in the supply chain to be," Blackhurst told FOX Business. "And so what we want to encourage consumers is, you don’t need to go out and buy stockpiles of products, but you might want to be thinking about shopping now … for the holidays."
She encouraged consumers to adapt their spending habits if what they want is not available.
"If you go to the store … and they don’t have the exact product you need, then just adapt and buy something different," Blackhurst said. "The companies are literally doing everything they can. But it’s just disaster upon disaster upon disaster upon disaster that’s causing all of these problems in the supply chain."
At this time last year, ocean freight rates from China to the U.S. West Coast were $3,847 per 40-foot container. Now, the same container will cost $17,377 to ship, according to Freightos, a Hong Kong-based online freight marketplace.
The average time it takes for ocean freight to go door-to-door has increased 45% over the last year, from 51 days to 74 days, according to Freightos. Ports in Los Angeles and Long Beach, California, account for 40% of all shipping containers entering the United States.
The Associated Press contributed to this report.