Americans’ take-home pay is eroding due to high inflation.
On Friday, the Bureau of Labor Statistics announced that consumer price inflation has reached a 6.8% rate — the largest year-over-year increase since June 1982, as well as the sixth straight month in which inflation has remained above 5%.
The agency also revealed that “real average hourly earnings” — which consider the impact of inflation upon purchasing power — fell by 0.4% between October and November. Though nominal average hourly earnings rose by 0.3%, the effects were overshadowed by a 0.8% increase in consumer prices.
U.S. workers at private companies earned an average of $31.03 per hour in November, according to the Bureau of Labor Statistics. Over the past year, workers’ hourly pay has increased by 4.8%.
But when you factor in inflation, real wages are down 1.9% over the past year, according to the BLS. From October to November, real average hourly earnings for all employees decreased 0.4%. Going back to the start of the pandemic, real wages have declined roughly 1% since February 2020, Furman estimated.
As summarized by CNBC, some of the largest consumer price increases between November 2020 and November 2021 apply to goods such as:
- Gas — 58.1%
- Used vehicles — 31.4%
- Hotels — 25.5%
- Meat, poultry, and fish — 13.1%
- Furniture and bedding — 11.8%
- New vehicles — 11.1%
- Domestic services — 10.2%
- Jewelry — 6.7%
- Electricity — 6.5%
- Food — 6.1%
- Apparel — 5%
- Milk — 4.6%
- Fruits and vegetables — 4%
A recent poll found that more than three quarters of Americans say inflation is impacting their lives. Yahoo News — which sponsored the survey alongside YouGov — reported:
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