We're hearing more about shrinkflation, skimpflation and stagflation. Here's what they mean

Canadians seeking advice on how to navigate grocery prices in an ever-unpredictable sea of rising inflation are learning to pilot their boat through shrinkflation, skimpflation and stagflation — but what do these tongue-twisters mean?

Here's a quick breakdown of the terms you may have seen bandied about in the news.

SHRINKFLATION

Ever looked at the fine print on a box of cereal you've been buying at the same price for years and realized that there's suddenly less grams listed than what you remembered it weighing before?

That's an example of shrinkflation — manufacturers quietly shrinking the size of a product so consumers are getting less for their buck. Often consumers don't notice it's happening, sometimes because the packaging makes the product look the same size as before, or because the price per product seems lower and they forget to check the price per pound.

Sylvain Charlebois, director of the Agri-Food Analytics Lab at Dalhousie University, told CTV Toronto in the summer that this concept has been around for a while, adding that the Oreo cookie, for example, is now much smaller than it used to be. 

"There's a limit to this before companies are selling air itself," he said in July. "But this is something that's affecting every section of the grocery store. It's really quite significant."

SKIMPFLATION

In simple terms, skimpflation refers to when manufacturers continue to release the same food products, but start making them with cheaper ingredients than before in a bid to cut costs.

"In skimpflation, you are getting less for your money," American consumer lawyer Edgar Dworsky told CTV News from Boston.

Read more: Skimpflation: How food companies are swapping ingredients to reduce costs

An example of this might be manufacturers using less paper pulp in toilet roll, or cheaper flour to make their spaghetti.

Manufacturers often argue that tactics such as shrinkflation and skimpflation are intended to help them keep up with rising inflation and keep costs down. But it's consumers who ultimately pay the price in terms of the quality of their food, according to experts like Dworsky.

STAGFLATION

We know to worry about high inflation, but stagflation is what happens when inflation is accompanied by a stagnant economy, causing a sticky situation for both consumers and manufacturers.

As the economy grows, both businesses and people spend more money on goods and services, which can lead to businesses raising prices due to high demand. This means inflation goes up, as inflation is a rise in overall price levels.

A moderate level of inflation often accompanies steady economic growth, but high inflation in the absence of economic growth ends up putting us in a period of stagflation.

Dave Popowich, portfolio manager at CIBC Wood Gundy, explained to CTV News Calgary earlier this month that stagflation is not the same thing as a recession, noting that a recession is often defined as two back-to-back quarters of negative economic growth.

"We started this year with high inflation, but the problem has been exacerbated, clearly, by the war in Ukraine and the pressure it's put on things like oil and gas prices and energy, on a broader category, and also food, things like wheat," he said.