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Workers Only Make 8 Cents More Per Hour, Inflation-Adjusted, Than January 1973

Inflation adjusted (real) earnings have declined 9 out of the past 12 months. There has been no gain since 1973.
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Hourly Earnings and Real Hourly Earnings 2021-08

Real Earnings

Real Earnings Month-Over-Month 2021-08

Coupled with the BLS release of the CPI is the Real Earnings Report.

  • Real average hourly earnings for all employees increased 0.4 percent from July to August, seasonally adjusted. This result stems from an increase of 0.6 percent in average hourly earnings combined with an increase of 0.3 percent in the Consumer Price Index for All Urban Consumers (CPI-U). 
  • Real average weekly earnings increased 0.3 percent over the month due to the change in real average hourly earnings combined with no change in the average workweek.  

The lead chart says what you need to know. Factoring in the CVPI, inflation-adjusted wages have stagnated since 1973.

Inflation Takes a Big Bite Out of the Apple

The Real Earnings data accompanies the CPI. 

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The numbers are even worse than they look because they do not factor in actual housing prices and medical costs paid on behalf of consumers (think Medicare and corporate plans). 

In retrospect, inflation did just not take a bite out of the earnings apple, it at the whole thing, and then some for anyone looking to buy a home.

For discussion, please see CPI Rises Less Than Expected But Year-Over-Year Numbers Remain Elevated

Factoring in housing, my last report had year-over-year CPI at 8.57%. For discussion, please see Housing Adjusted Real Interest Rates Sink to a Record Low -8.5 Percent.


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