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San Diego businesses struggle to keep up with gas prices and inflation

President Biden said that gas prices will continue to go up in light of more sanctions on Russia. But experts say it’s not just gas prices that will increase. KPBS reporter Kitty Alvarado visited a family owned restaurant and spoke with an economist on what this means for everyday Americans and if this continued inflation will trigger a recession.

Owners Viridiana Rubio and T.J. Tabatabaei of the Huapangos Mexican Cuisine have been working hard serving up authentic, delicious Mexican dishes to the community in Hillcrest for almost two decades.

It's a true family-owned and operated establishment. Their children grew up working there, and some still do.

"Ay que rico," said a happy customer as Viridiana's son brought some spicy salsa to her table.

They’ve also been working hard to keep the doors open since the pandemic hit.

"When the pandemic started it’s been the hardest years that we had to live through," Rubio said.

But it’s been one hit after the next. Now that the pandemic is easing, inflation and gas prices are clawing at their profits.

"The meat went up, the to-go boxes went up, the tortillas are going up … and then the payroll, the minimum wage went up in January so that’s another thing that’s hurting us," said Rubio.

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"We already were struggling with high prices because of pandemic and all these things. Now the price — everything, I’m 100 percent positive, is going to go up," said Tabatabaei.

They don't want to raise their prices, but menu prices are a tricky thing to increase.

"For instance, if I sell a carne asada burrito or enchiladas, I have a set price for that I cannot raise it up for $21." Rubio said. "A carne asada burrito or a plate of enchiladas I cannot go up to $22 so, I have to have a set price. So for us with the food we’re kind of stuck."

"These people are exactly like us," Tabatabaei said about his customers. "How can they afford to buy whatever, I’m not just talking about food they cannot afford it and honestly, I’m scared to raise the prices ... If I raise the prices the business again is going to go down."

Alan Gin, an associate professor of economics at the University of San Diego, said Russia’s invasion of Ukraine will result in continued inflation, impacting consumers and local businesses the most.

"I think it’s going to be translated into the prices of products with gas prices up, diesel prices up. That’s going to cost more money," he said. "Then, to ship products ... that will eventually be built into the price of products and unfortunately, this could keep inflation relatively high."

But Gin said because the economy is strong it won’t have a lasting impact or trigger a recession unless it drags on.

"So a lot will depend on how long that conflict goes on … We’re below 4% unemployment rate nationwide," he said. "That means that the economy is in pretty good shape right now. So I think even if this conflict goes through the summer, that’s not going to be enough to tip the economy into a recession."

For now, Rios and Tabatabaei said they will keep working and remain hopeful they can continue doing what they love.