Between 1921 and 2022, the Consumer Price Index went from 17.9 to 292.655.
Cumulatively, prices increased 1534.9%, which works out to an average of
2.81% per year. Put differently, a dollar in 1921 bought what
$0.06 buys in 2022.
Consumer prices fell 10.5% in 1921, the mirror image of the wartime
inflation that had more than doubled the cost of living between
1913 and 1920. The Depression of 1920-21, one
of the sharpest contractions in U.S. history, bottomed out that July
according to the National Bureau of Economic Research, even though it had
lasted barely eighteen months. Unemployment climbed toward one worker in ten
as businesses cut production and prices to work through wartime inventories,
but the same collapse in prices also meant the recovery, once it started,
had room to run without reigniting inflation. Warren Harding took office
March 4, promising a return to “normalcy” after a decade of war, pandemic,
labor unrest, and rapid price swings; his administration moved quickly to
cut top income tax rates and federal spending. Congress also acted on
immigration that year: the Emergency Quota Act, signed May 19, capped annual
arrivals from each country at 3% of that nationality’s population in the
1910 census, the first time the United States had set a numerical ceiling on
immigration. The law favored northern and western Europe and cut total
immigration by more than half compared with prewar levels; Congress
tightened the formula again in 1924. First-class postage held at 2 cents,
unchanged since mid-1919.
The headline number is an average. Individual categories moved very differently over this
period. Here is what $100 of 1921 spending costs in 2022, by category:
Category
Avg. yearly inflation
$100 in 1921 →
All items (CPI-U)
2.81%
$1,635
Food
2.97%
$1,921
Apparel
1.34%
$383
Not shown because the BLS began these indexes after 1921: core (all items less food & energy) (1957–), energy (1957–), housing (1967–), medical care (1935–), transportation (1935–), recreation (1993–), education & communication (1993–).
Long periods are sampled every 5 years; the calculator above covers any pair of years.
The destination year: 2022
2022 was the year inflation returned. Consumer prices rose 8.0% on average,
the worst since 1981, driven by pandemic-era supply chains, stimulus-fueled
demand, and an energy shock from the war in Ukraine. Gas briefly topped $5 a
gallon nationally for the first time ever, and “inflation” became the
top-ranked economic concern in nearly every poll of American households.
MLA: “Inflation from 1921 to 2022: $100 is worth $1,635 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1921-to-2022/
APA: InflationCalculator.com. Inflation from 1921 to 2022. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1921-to-2022/