London Daily

Focus on the big picture.
Monday, Aug 17, 2026

What is shrinkflation, skimpflation and stagflation?

What is shrinkflation, skimpflation and stagflation?

Have you been out to your favourite restaurant, only to discover the food wasn’t quite as good or the portions were much smaller? Or even eating at home has become more expensive as the supermarket shop adds up?

You may have also just discovered that your Amazon Prime membership is about to get a little more expensive and if you are in the United Kingdom, a McDonald’s cheeseburger is also going up for the first time in more than 14 years.

The feeling that everything is just a little bit worse and perhaps more costly is not unfounded with the blame largely being placed on inflation.

But what exactly is it and the other terms that are being waved around, such as shrinkflation, skimpflation and stagflation?

Euronews Next breaks down what exactly these words mean.


Inflation


Many countries are dealing with the effects of inflation, now at a 40-year high. What that means is that you get less bang for your buck and you are now getting even less value on goods.

Basically, prices go up when there are shortages and/or there is a large demand for goods or services.

The most current example is Amazon choosing to raise the cost of its Prime membership, a decision it blamed on inflation.

Inflation is measured by how expensive goods and services have become over a certain period of time, usually a year. One well-known indicator is the Consumer Price Index, which measures the percentage change in the price of a basket of goods and services consumed by households.

Moderate inflation is considered normal but significant spikes can mean the cost of living can suddenly become much higher.

The feeling that everything is just a little bit worse and perhaps more costly is not unfounded with the blame largely being placed on inflation.


The reason why inflation is so high at the moment is due to a perfect storm of economic woes as the International Monetary Fund (IMF) on Tuesday dubbed the world’s economic outlook “gloomy and more uncertain”.

Many have blamed the world's financial problems on the impact of Russia’s invasion of Ukraine, which has consequentially ramped up petrol and food prices and seen shortages of staple goods.

But even before the war in Ukraine broke out in February, the coronavirus pandemic meant factory shutdowns and also logistical hurdles in export hubs such as China causing supply chain issues and shortages. This ramped up the prices of goods and the cost to transport them.


Shrinkflation


If you are a Swiss chocolate fan, you may remember when Toblerone in 2016 looked a bit different; it no longer resembled the Alps and had the gaps between triangles widened.

File- More valleys, fewer chocolate peaks


While the cost of the chocolate bar did not go up, it shrank from a net weight of 170 grams to 150 grams.

This is a classic case of what is called “shrinkflation,” when the volume or size of a product shrinks.

It can be seen as a little more sneaky, as consumers are less likely to weigh a product and notice the difference compared to a price hike.


Skimpflation


“Skimpflation” on the other hand is when companies “skimp” on the quality of the product or service.

One of the main reasons this happens is because companies cut back on the quality of the service so it can still be profitable, meaning less money for staffing or materials are cut back on.


Recession


If stagflation is defined as a recession accompanied by inflation, then it is important to know what a recession is.

While the word can cause alarm, recessions are a natural part of the economic cycle. A recession is defined by two successive quarters having contracting gross domestic product (GDP) results.

But issues arise if low growth is combined with unemployment or high inflation, in what is known as stagflation, which is much rarer.


Stagflation


Another word being floated around at the moment is “stagflation”. As the name suggests, everything remains stagnant and does not move much.

In economic terms, it means high inflation, economic stagnation and high unemployment at the same time. Stagflation can happen if there is a recession before the rate of inflation has gone down to where central banks want it to be.

Many countries are dealing with the effects of inflation, now at a 40-year high.


The term is said to have been widely used in the 1970s after a recession in the US hit hard and was accompanied by inflation.

The period of stagflation in the 1970s and 1980s saw several recessions and weak economic growth. It ended after the US’s national bank, the Federal Reserve, raised interest rates to curb inflation.

Newsletter

Related Articles

0:00
0:00
Close
China’s Lifelike AI Humans Move From Livestreams Into Real-World Service Roles
Sarah Ferguson Reportedly Retreats to Late Ex-Boyfriend's Swiss Chalet
Cristiano Ronaldo and Georgina Rodríguez Sign Prenup Protecting Their Separate Fortunes
Thieves Steal Antonello da Messina Renaissance Masterpieces From Sicilian Museum
Better.com Founder Who Fired 900 Employees on Zoom Is Ousted as CEO
Italian Speed Camera Issues Nearly 32,000 Fines in 10 Weeks, Worth More Than €3 Million
AI Manager at San Francisco Store Recommends Firing Human Employee
Google Launches Pixel 11 With Gemini AI at the Center of Its Hardware Strategy
Campaigners Press Government to Strengthen Rights for Four Million Gig Workers
Government Considers Higher Private Rents to Spread Asylum Accommodation Across UK
UK Moves to Protect Historic Pubs From Conversion Into Housing and Offices
Nigel Farage Wins Clacton By-Election to Return to House of Commons
British Manufacturers Report Rising Cybersecurity Threats Across Industrial Supply Chains
Royal Navy Increases Monitoring of Russian Ships in UK Waters by 25 Percent
England Adds More Than 350 Medical Training Posts to Strengthen NHS Capacity
NHS Waiting Lists Over 52 Weeks Rise by More Than 11,000 Patients
Brent Crude Near $88 Raises Fresh UK Energy Cost Concerns
UK Treasury Warns Prolonged Strait of Hormuz Disruption Could Cut 2027 Growth to 0.3 Percent
UK Economy Grows 0.4 Percent in Second Quarter as Energy and Inflation Risks Persist
UK Heatwave Triggers Emergency Alert as Government Unveils £65 Million Farm Support Package
Reform UK Unveils Plan to Cut Welfare Spending by More Than £50 Billion a Year
Prime Minister Andy Burnham Praised Extinction Rebellion for Doing a 'Great Service'
UK Wildfire Phone Alert Triggers Backlash as Users Switch Off Emergency Warnings
Heathrow Roads Reopen After Burst Water Main Floods Access to Terminals 2 and 3
Former NBA Players Enes Kanter Freedom and Royce White Say They Will Enter 2027 WNBA Draft
Former Cambridge Professor Jason Arday Found Dead Days After Resigning Amid Plagiarism Row
US Appeals Court Rules AI Agent's Website Actions Are Legally Attributed to the User
France's Constitutional Council Blocks Social Media Ban for Children Under 15
Liechtenstein Changes Royal Succession Rules to Allow Women to Inherit the Throne
Women Allege Rape and Sexual Abuse at British Army College for Teenage Recruits
Minnesota: Two independent investigators posed as Muslims (one wearing a burqa) and showed how they could vote in elections without identification.
UK Prime Minister Andy Burnham Takes Regional Tour to Highlight Local Infrastructure and Environmental Problems
Nigel Farage Wins Clacton By-Election to Return to the House of Commons
Bank of England Warns Rising Inflation Could Squeeze UK Household Incomes
UK Government Announces £65 Million Aid Package for Farmers Hit by Severe Drought
UK Economy Grows 0.4% in Second Quarter Despite Energy Market Pressures
UK Issues Emergency Alert as Severe Wildfires Spread Across England and Wales
UK and Finland Discuss European Defence and Continued Support for Ukraine
Nigel Farage Wins Clacton By-Election to Return to the House of Commons
UK Government Deploys Military to Help Fight Wildfires and Bans Disposable Barbecues
UK Records Hottest Day of the Year as Fifth Summer Heatwave Peaks in Southern England
UK Condemns Houthi Actions and Warns of Red Sea Threat to Global Trade
UK and Solomon Islands Open Wildlife Photography Exhibition in Honiara
UK Small Businesses Face Continued Cash Flow and Tax Pressures
Greatham Marsh Restoration Restores Tidal Wetland in Hartlepool After More Than 200 Years
UK Health Regulator Urges University Students to Check Meningitis and Measles Vaccination Status
Mining Remediation Authority Completes Major Ground Stabilization Works in Scottish Community
UK Food Crime Investigators Seize 33 Tonnes of Illegal Food in Multi-Agency Operation
Technical Qualification Uptake Hits Record High as Advanced Mathematics Results Improve
UK Summer Temperatures on Course to Challenge Long-Standing Records, Met Office Says
×