Pent-up demand allows companies to get away with even large price rises. Consumer prices may have risen even faster in May than in April, according to forecasts. As a result, returns, which held up in the first quarter, are expected to do so again in the second, says Jonathan Golub of Credit Suisse, a bank. Big firms’ net margins have actually been rising. This suggests that as yet, far from forcing companies to absorb the extra costs, inflation may have given them some extra pricing power.

Plenty of businesses are, however, preparing for a time when they can ratchet prices up no longer. Sridhar Tayur of the Tepper School of Business at Carnegie Mellon University, who consults with three large companies, says that each of them is redesigning products to eliminate waste and streamline manufacturing. Mr Adamczyk said in January that he had established an internal Honeywell task-force to respond to inflation (though he was vague about what exactly it might do). Lineage, a logistics firm with 200 cold-storage warehouses across America, says it has created several such teams. One focuses on avoiding supply bottlenecks in critical construction projects, another on recruiting workers in a tight market.

Rising labour costs are chief executives’ biggest headache by a long way. Some companies are trying to keep a lid on future wage increases by using one-off inducements, such as signing bonuses, to attract new recruits. Most, though, have no choice but to raise pay. Andrew Obin of Bank of America reckons that American manufacturers are paying existing employees about 4% more than a year ago. But, he estimates, workers can expect a pay rise of 13% if they switch jobs. Wages for non-supervisory workers rose at an annualised rate of nearly 7% between April and May, according to the Bureau of Labour Statistics.

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