The latest government data show that inflationary pressures and a depressed job market are hurting an economy that barely grew in the first half of the year.
Higher prices could also keep the Federal Reserve from taking major steps to stimulate the growth next week when policymakers meet.
"Unless spirits improve soon, businesses will ramp up layoffs, consumers will pull back, and the economy will fall back into recession," said Mark Zandi, chief economist at Moody's Analytics in West Chester.
In the Consumer Price Index report, the BLS said the cost of food, energy, rent, and clothing all increased nationwide. Excluding volatile food and energy costs, so-called core prices increased 0.2 percent.
In the Philadelphia area, the increase during the July-August period was led by a seasonal advance in apparel prices, which rose 6.6 percent. Food and shelter prices locally both were up 0.6 percent, but the cost of energy - including both housing and transportation fuels - dropped 0.4 percent, the report said.
For the last 12 months, inflation in the area increased 3.4 percent, slightly less than the national rate of 3.8 percent.
The region consists of Philadelphia and the four suburban counties in Pennsylvania, South Jersey from Burlington County to the Shore, New Castle County in Delaware, and Cecil County in Maryland.
Some inflation can be healthy for the nation's economy because it encourages people to spend and invest rather than sitting on their cash. More spending drives corporate growth, which makes businesses more likely to hire people.
For the 12 months that ended in August, core prices - without food and energy - surged 2 percent. That's the biggest year-over-year increase in nearly three years, and it's at the high end of the Federal Reserve's informal inflation target.
