Consumer Prices: Trends and Policy Options Related to Shrinking Product Sizes
Government Accountability Office07/31/2025
Fast Facts
In recent years, some shoppers have noticed they’re paying the same or more for a smaller amount of their favorite household products—known as “shrinkflation.” For example, a pint of ice cream (16 fluid oz.) might now be 14 fluid oz. Subtle package changes can make it hard to detect.
While shrinkflation increases prices, its effect on inflation is small because most spending is on things that cannot be shrunk. But the prices of certain products, like coffee and cereal, are affected more.
We examined policy options that might help. For example, requiring labels on smaller products could increase transparency, but may be hard to enforce.
A person in a grocery store looking at cereal boxes
Highlights
What GAO Found
Product downsizing, or “shrinkflation,” occurs when an item’s quantity decreases without a commensurate price drop. This raises the per-unit price and contributes to inflation. GAO’s analysis of 2019–2024 Bureau of Labor Statistics data found that downsizing accounted for less than 1/10 of a percentage point of the 34.5 percent increase in overall consumer prices during this period. This is because downsized products were a small share of all products tracked in inflation measures. However, in the top five product categories experiencing downsizing, the contribution of size changes to inflation ranged from 1.6 percentage points for cereal to 3.0 percentage points for household paper products (e.g., paper towels). Separately, GAO’s analysis of 2021–2023 consumer purchase data for thousands of items across seven product categories found that while less than 5 percent of items in each category were downsized, those items made up a larger share of total dollar sales. For example, in the cereal category, 1.1 percent of items, representing 8.6 percent of sales, were downsized.
Research suggests that consumers tend to be less responsive to downsizing than to equivalent price increases and that downsizing has limited effects on purchase behavior. This limited responsiveness could stem from lack of awareness of subtle packaging changes, infrequent purchases, or strong consumer preferences for certain products and brands.
Several policy options that aim to increase transparency around downsizing also present implementation challenges. For example, some countries require manufacturers or retailers to disclose downsized items, but regulators may face difficulties defining downsizing and identifying noncompliance. In addition, a federal unit price labeling policy could help consumers compare prices using consistent unit price displays, even when downsizing goes unnoticed. However, enforcement of such a policy may rely on U.S. states and would need to consider states’ potential roles and resources.
Why GAO Did This Study
In 2021 and 2022, the U.S. experienced its highest inflation rate since 2011. Amid rising prices for everyday goods, policymakers have raised questions about product downsizing and its effects on households.
GAO was asked to review issues related to product downsizing. This report examines (1) trends in product downsizing, (2) factors affecting consumer response to product size changes, and (3) advantages and disadvantages of policy options for addressing concerns related to product downsizing.
GAO analyzed Bureau of Labor Statistics data on the frequency of product size changes and their impact on inflation. In addition, GAO analyzed retail scanner data—aggregated consumer purchase data—for all products within seven high-spending categories to determine the extent of size changes and their price effects. GAO reviewed studies on how consumers respond to size changes and interviewed or obtained written responses from officials from the Bureau of Labor Statistics, the National Institute of Standards and Technology, the Federal Trade Commission, two state agencies, nine foreign countries, three consumer groups, and three industry groups (representing manufacturers, wholesalers, and retailers), as well as eight academic researchers.
For more information, contact Alicia Puente Cackley at cackleya@gao.gov or Michael Hoffman at hoffmanme@gao.gov.