Graphic Media Alliance

06/16/2026

Inflation Pressures Persist as Manufacturing Costs Continue to Rise

Source: National Association of Manufacturers Monday Economic Report, June 15, 2026

The latest National Association of Manufacturers (NAM) Monday Economic Report highlights growing inflationary pressures across the economy, driven largely by higher energy costs and increasing prices throughout the supply chain. While manufacturing activity remains resilient, the report suggests that cost challenges continue to weigh on businesses and consumers alike.

Consumer prices increased 0.5% in May and were up 4.2% compared to one year ago, marking the largest annual increase since April 2023. Core inflation, which excludes food and energy, also remained elevated at 2.9%, continuing to exceed the Federal Reserve's long-term target of 2%. Rising energy prices were a significant contributor, with overall energy costs increasing 23.5% over the past year.

The pressure is also evident on the production side of the economy. Producer prices, often viewed as a leading indicator of future consumer prices, rose 1.1% in May and were up 6.5% year-over-year, representing the largest annual increase since late 2022. Goods prices surged 2.8% during the month, while energy prices increased 10.7%, including a 23.4% jump in gasoline prices. The report attributes much of the recent energy volatility to ongoing conflict in the Middle East.

For manufacturers and print service providers, these developments may translate into continued pressure on paper, transportation, packaging, fuel, and other operating costs. As suppliers absorb higher production expenses, many businesses could face difficult decisions regarding pricing, inventory management, and capital investments.

The report also noted that inflation is beginning to outpace wage growth. Real average hourly earnings declined 0.1% in May as wage increases failed to keep pace with rising prices. For production and non-supervisory employees, real earnings fell 0.3% during the month and 0.8% over the past year. This trend may create additional challenges for employers already competing for skilled labor while managing rising compensation costs.

Beyond inflation, the report found that small business optimism remains below historical averages, with uncertainty continuing to weigh on future planning. While international trade, wholesale sales, and housing activity showed signs of strength, economists remain cautious as businesses navigate a complex economic environment marked by elevated prices and persistent uncertainty.

For graphic communications companies, the key takeaway is clear: inflationary pressures have not fully subsided. Monitoring supplier costs, maintaining pricing discipline, and focusing on operational efficiency will remain important strategies as manufacturers continue to navigate an uncertain economic landscape.