STEVE INSKEEP, Host:
Coming up with a CPI requires hundreds of government workers who go around the country and collect thousands of prices each month. Caitlin Kenney, from our Planet Money team, caught up with one of them.
CAITLIN KENNEY: The CPI number starts with people like this guy.
M: I'm George Minichiello. I'm an economic assistant with the Bureau of Labor Statistics of the U.S. Department of Labor.
KENNEY: Every work day, George gets up and goes to different stores and businesses with one basic question: How much does stuff cost? He prices fishsticks, dental fillings, Caribbean cruises, even stuff he himself would never buy.
M: I've learned how to describe ladies' dresses - you know, handkerchief hem, or I've learned what ruffles are and ribbons and lace. So I probably know too much about ladies' clothing.
(SOUNDBITE OF LAUGHTER)
KENNEY: George and the army of other economic assistants have a list of things to shop for, prepared by their bosses at the Bureau of Labor Statistics. The list represents the purchases made by a typical U.S. household. It's called the market basket. And the items in it are very specific. For example, today, George is looking for lettuce at a small supermarket in Brooklyn, New York.
(SOUNDBITE OF BEEPING SCANNER)
M: A multipack of romaine lettuce - not certified organic - from California. Now, we're going to get the price.
(SOUNDBITE OF BEEPING SCANNER)
U: Two ninety-nine.
M: Two ninety-nine. Thank you. So 2.99 is the same price. Oh, wait, we have a change here. It's the same price. However, the weight is different. So effectively, that's a price decrease.
KENNEY: So we're seeing deflation right here?
M: We're seeing a reduction in the price. Yes.
KENNEY: The drop in the price of that lettuce was 27 percent, which may sound scary. It could sound like deflation, an overall decrease in prices, which is a bad thing. But George says, relax. Food doesn't really tell you that much about the overall economy. The price of food always goes up and down. For example, right now, corn and wheat prices are shooting up. That's why most experts focus on what they call core CPI, where they cut out food and energy prices that tend to go up and down in huge swings.
(SOUNDBITE OF DOOR CLOSING)
KENNEY: The next item on George's list is a shirt, so we head to a clothing store in another part of Brooklyn. But again, we're not just looking for any shirt.
M: I'm looking for the fabric content - 97 percent cotton and 3 percent Lastol. It's a long-sleeve shirt; it's a full-button front.
KENNEY: As we're talking, the owner of the store approaches.
U: Hi, nice to meet you.
KENNEY: Now, I'm not allowed to identify him or reveal the name of his store. The Bureau of Labor Statistics is very secretive about the data it gathers because this information could move markets. But I ask the store owner how he feels about being part of the CPI, a number that impacts so many people's lives.
U: I guess you're in awe a little bit. You can't believe that you have an effect on the statistics that people see.
KENNEY: Caitlin Kenney, NPR News.
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