The worst of rising prices seems to be over, but most Americans are still feeling the pinch when they go shopping.
That’s because most people’s wages have yet to catch up with the cumulative effects of inflation since it started to rise rapidly in 2021.
From January 2021 to June 2024, prices have risen 20%, while wages increased by 17.4%, according to Bankrate’s Wage To Inflation Index, which is calculated using the U.S. Department of Labor’s headline consumer price index for inflation and the employment cost index for wages.
Inflation has slowed over the past year and wages are gradually catching up, helping to offset some of the inflation that peaked in mid-2022. But there’s still a long way to go.
Looking at a different measure, median real wages — wages adjusted for inflation — have barely budged, growing at just 0.8% over the last year, as of August 2024.
In fact, wage growth is actually slowing, down …