"Many economists now believe that the pandemic played a more central role in the inflation story than they previously realized. An analysis by the Brookings Institution concluded that inflation was mostly a story of pandemic-shutdown ripple effects. (Other studies have come to the same conclusion.) Consumers, stuck at home, shifted their spending from entertainment and services toward physical goods at precisely the moment that the supply chains that were supposed to provide those goods were being catastrophically disrupted. The sudden firing and rehiring of tens of millions of workers produced a chaotic labor market that forced employers to quickly raise wages. Together, those forces created the perfect recipe for rising prices. Russia’s invasion of Ukraine, which sent fuel prices soaring, only made things worse. As with crime, the shock took a long time to work its way through the economy. But when it finally did, the change was dramatic. By the end of 2023, America’s unemployment rate, inflation rate, and economic-growth trajectory looked almost identical to what they had been just before the pandemic. (One measure of inflation did tick up slightly in December, but many experts believe that was caused by a temporary lag in the data.) Prices remain higher, of course, even though the inflation rate has returned to normal. But inflation-adjusted wages are rising rapidly and recently surpassed their pre-pandemic levels. Some indicators, such as household wealth, income equality, and women’s labor-force participation, look much better than they did in 2019."