What is shrinkflation? Examples, how it is measured and whether it is legal

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Shrinkflation is when a product gets smaller (fewer ounces, grams or sheets) while its price stays the same, so you pay more per unit without the shelf price changing. Official inflation figures already capture it: the US Bureau of Labor Statistics (BLS) and the UK Office for National Statistics (ONS) track the price per unit, so a smaller pack at the same price counts as a price rise.

Shrinkflation is often discussed alongside inflation after COVID, but the official studies below cover years before 2020. Here is what they found.

How does the CPI count shrinkflation?

BLS calls it downsizing. In a February 2023 article, BLS economist Kari McNair explained that when prices rise, companies can either raise the list price or offer a smaller amount of the product for the same price. The Consumer Price Index is built to catch both.

Data collectors follow the same products over time. When an item is downsized or upsized, the collector records the new size and alerts economists at the national office. For items sold by weight or volume, BLS calculates an effective price per standard size, usually per ounce. The article gives this example: a half-gallon (64 ounces) of ice cream at $5.99 costs about $0.093 per ounce. If the same ice cream shrinks to 60 ounces and still costs $5.99, the price per ounce becomes about $0.0998, a 6.7% increase that goes into the CPI.

Items without a weight are adjusted too. If toilet paper goes from 220 sheets per roll to 200, BLS records a 10% increase in the price per sheet.

How much does shrinkflation add to inflation?

Very little overall, and a lot in a few categories. BLS estimated that between 2015 and 2019, product size changes (downsizing and upsizing together) raised the all items CPI by 0.01% per year.

The effect was concentrated. Over 2015-2019, the indexes with the largest price increases due to downsizing were:

• Baby food: +2.81%
• Snacks: +2.64%
• Fresh biscuits, rolls and muffins: +1.59%
• Candy and chewing gum: +1.35%
• Household paper products: +1.30%

BLS now publishes a research index, the R-CPI-SC, which estimates what the CPI would have shown without product size changes, starting with December 2014 data. It covers food at home, its components and a selected group of other items, and is updated quarterly. Comparing it with the official CPI shows how much downsizing has added in each period.

What are some examples of shrinkflation?

Official sources name product types, not brands. The BLS article describes snack packs of potato chips going from 4.5 ounces to 4.25 ounces, and 8-ounce bags dropping to 7.5 ounces. It lists potato chips, paper towels, cereal, cleaning supplies and candy among common examples of downsizing.

In the UK, the ONS found the same pattern. Looking at January 2012 to June 2017, it reported "consistently more reductions" than increases in size, across both food and non-food items. Its illustration of the adjustment method is a chocolate bar that shrinks from 85g to 80g. A later ONS article covering 2015-2017 found that 206 products in its sample shrank and 79 got bigger, with food and drink making up most of the reductions. It also found that prices tended not to change when products changed size, which is the defining feature of shrinkflation.

Does shrinkflation affect UK inflation figures?

The ONS adjusts for size changes when it compiles consumer price indices. In its July 2017 analysis it compared its published CPIH index with a version that ignored size changes. Across all items, the difference was about 0.03 percentage points since 2012. Only six months showed a measurable gap in the growth rate, and it never exceeded 0.1 percentage points.

One category stood out. For sugar, jam, syrups, chocolate and confectionery, which makes up about 1% of the CPIH basket, the published index was 1.22 percentage points higher over the period than the version without the size adjustment. That is shrinkflation in confectionery showing up in the official figures.

Is shrinkflation legal?

In general, yes, provided the package tells the truth about what is inside. In the US, the Fair Packaging and Labeling Act directs the Federal Trade Commission to require that consumer commodities (other than food, drugs, therapeutic devices and cosmetics) disclose their net contents on the label.

In the UK, Aberdeenshire Council's Trading Standards service puts it simply: shrinkflation is "not illegal" as long as businesses are honest on the label, so a 500g item can become 400g if the new pack says 400g. What is against the law is short weight, where the pack contains less than the label states.

UK regulators have focused on helping shoppers compare prices per unit. The Competition and Markets Authority (CMA) reviewed unit pricing in groceries and in July 2023 reported problems including missing or wrongly calculated unit prices, labels that were hard to read, inconsistent units (for example tea priced per 100 grams in one place and per bag in another) and unit prices not shown for products on promotion. It called on the government to reform the Price Marking Order 2004. In January 2024 the CMA published consumer research and welcomed the government's proposed reforms. Its pricing analysis also found that larger packs are usually, but not always, cheaper per unit.

How can shoppers spot shrinkflation?

The unit price on the shelf label (per ounce, per 100g, per sheet) is the tool regulators point to, because it shows the cost per unit whatever the pack size. Comparing it over time, or across pack sizes, reveals a smaller pack at the same price. For the wider picture of how much prices rose after 2020, see what causes inflation, the supply chain crisis and the UK cost of living crisis.

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