WASHINGTON — The Social Security Administration announced Wednesday that recipients will receive a nearly 6 percent increase in benefits next year.
The boost in benefits, which will affect nearly 70 million people, is being fueled by a spike in inflation caused by supply chain bottlenecks, worker shortages and other economic disruptions from the Covid pandemic.
The larger checks will begin to arrive for most recipients in January.
At the end of December, about 8 million recipients of Social Security’s Supplemental Security Income program, which is for people who are disabled or receive little income, will start to receive increased payments.
Rising inflation contributed to the Social Security Administration determining that the cost-of-living increase, or COLA, will be 5.9 percent for 2022. Data released Wednesday by the Bureau of Labor Statistics showed that prices rose by 5.4 percent on an annualized basis in September and the inflation rate rose a seasonally adjusted 0.4 percent in September from August.
“Some other adjustments that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $147,000 from $142,800,” the Social Security Administration announced Wednesday.
The government said that beneficiaries will receive a notice in December about their increased payments.
Typically, the COLA increase has been 1 to 2 percent each year. At the height of the Great Recession, however, in 2009, benefits went up by 5.8 percent for 50 million people, which at the time was the largest increase in more than a century.
Rebecca Shabad is a congressional reporter for NBC News, based in Washington.