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Consumer Price Index

This page provides an overview of the Consumer Price Index for local governments in Washington State, with links to national data and statistics from Seattle-Tacoma-Bremerton and Portland-Salem.


Overview

The Consumer Price Index (CPI) is a measure of the change in prices paid over time for a fixed market basket of goods and services, as calculated by the U.S. Bureau of Labor Statistics.

The Consumer Price Index for All Urban Consumers (CPI-U) measures the percentage change in prices faced by urban consumers and covers approximately 87 percent of the population.

The Consumer Price Index for Wage Earners and Clerical Workers (CPI-W) is sometimes referred to as the "blue-collar measure." It is a subset of the CPI-U. Its market basket reflects the expenditures of urban households that derive more than half their income from clerical and hourly wage jobs. It covers approximately 32 percent of the population.

National data for each of these indices for the United States as a whole are compiled on a monthly basis. The results are available during the third week of the following month. The Seattle-Tacoma-Bremerton index (which includes King, Pierce, Island, Kitsap, and Thurston counties) is compiled six times a year, in the even-numbered months. The Portland-Salem index (which includes Clark County) is compiled twice a year, with the first half results published in August and the second half published the following February.

None of these indices measures price changes in rural areas. But realizing that towns in rural areas need some indicator to use, we recommend one of the U.S. indices.

CPI Geographic Changes Coming in 2018

Effective January 2018, BLS will introduce the first CPI geographic changes since 1998. This will impact both of the Pacific Northwest indices:

  • The Seattle-Tacoma-Bremerton index (which includes King, Pierce, Island, Kitsap, and Thurston counties, but not Snohomish County) will become the Seattle-Tacoma-Bellevue index (King, Pierce, and Snohomish counties; no longer includes Island, Kitsap, and Thurston counties).
  • The Portland-Salem index (which includes Clark County) will be eliminated.

Practice Tips: The Bureau of Labor Statistics recommends using one of the national indices for all contract adjustments. (See How to Use the Consumer Price Index for Escalation.) Not only are the Seattle-Tacoma-Bremerton and Portland-Salem versions published less frequently, they also are based on a smaller sample and are, therefore, more volatile and subject to measurement error.

Always write your contracts so that you will be adjusting on the basis of actual CPI figures. Never use estimates for contract adjustments.

Recommended Resources

Below are some useful resources from the U.S. Bureau of Labor Statistics:


Last Modified: November 28, 2017