South Florida is a place of pride for the Biden administration's efforts to draw attention to its economic policies.
It's also a place of frustration.
This region, along with Boston, has the lowest unemployment rate among the largest metropolitan areas in the nation. It October, it stood at 2.5%, which is unchanged from a year ago and down from a pandemic high of 14.2% in May 2020.
But South Florida also sports one of the highest consumer inflation rates in the country. The official rate has been stubbornly high, especially compared to the national Consumer Price Index, which is the most common inflation barometer. The regional inflation rate was 7.4%, down from the pandemic high of 10.2%. The national CPI shows a much more significant drop. It has fallen by two-thirds to 3.2% from its pandemic high of 8.9%.
The contrasts amplify just how important the economy is for voters in 2024. In a November survey by political polling firm Cygnal, 59% of Floridians believe their personal finances are in worse shape now compared to just a year ago. One in four cited inflation and the economy as the biggest issues, far out-pacing immigration, national security and abortion. More than one third of women younger than 55 years old said prices and jobs were their top priority.
The economy likely will be the defining election issue throughout the campaign year — as it is during most political cycles.
It poses a challenge in South Florida for both parties. For Democrats, a historic drop in unemployment is helpful to push back against any GOP narrative of a failing economy. However, the region's much higher inflation rate is a vulnerable attack point for challengers looking to criticize incumbents.
"I know that different parts of the country experience different economic challenges," said Heather Boushey, a member of the White House Council of Economic Advisers in an interview with WLRN. "One of the things that we're looking at is, 'What is (the price of) gasoline?'"
Energy prices have dropped significantly since rocketing higher in the early months of the Russian war in Ukraine. The average price for a gallon of unleaded is close to $3, according to AAA. That's down about 25 cents from a year ago and down 40% from the record high set in June 2022, just as the national inflation rate was peaking.
Yet, the drop in energy prices has not helped bring down the regional inflation rate as much as it has the national headline number.
"As we're looking at where prices are and the fact that overall the pace of price increases has fallen by about two thirds since its peak, we also want to make sure that the economy is moving forward," Boushey said.
Housing has kept South Florida's inflation rate much higher than the national figure. Economic statistics call it shelter, and how it figures into an inflation rate is the source of some debate. Housing is responsible for the largest portion – about a third – of calculating monthly inflation. However, housing costs like rent may not change quickly. After all, most residential leases lock in a cost for 12 months. "That has to work its way though (the data)," Boushey said.
For home owners, the shelter component of inflation is calculated by asking them, “If someone were to rent your home today, how much do you think it would rent for monthly, unfurnished and without utilities?”
That does not capture the owner's cost of their home since they may have purchased it years ago.
Despite these approaches, housing affordability is a big challenge in South Florida. A recent study from the University of Florida's Shimberg Center for Housing Studies found half of all households in Miami-Dade spend more than 30% of their income on housing.
"The president has a number of proposals around housing and increasing the supply of housing. But we're also doing a lot of things to make it easier to live in places and make it more affordable," Boushey said, pointing to the Bipartisan Infrastructure Law that has met billions of dollars invested to expand internet broadband, road construction and repair, and investment in ports, such as PortMiami.
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"[These are] all ways of lowering costs for families in really, really concrete ways," according to Boushey.
South Florida has been a leader in having people return to work. The unemployment rate in Miami-Dade County has been below 2% since July. In October, the jobless rate was 1.6%, just off the lowest rate since the Bureau of Labor Statistics started tracking the local unemployment rate in 1990.
"I think what this shows us is that this inflation that we were seeing was supply-side driven," said Boushey.
She also pointed to more people starting businesses as indicative of economic optimism. About one out of every eight new business applications nationwide have been made in Florida through the end of October, according to data from the U.S. Census Bureau.
"You're seeing this economy not only create good jobs, not only see the pace (of inflation) has come down," Boushey said, "but also creating that economic opportunity."
