Workers Treading Water: Wage Inflation = CPI Inflation

This is a syndicated repost courtesy of Online Course Notes For Financial Markets and Banking. To view original, click here. Reposted with permission.

The purchasing power of the US Dollar for consumers has been declining since the creation of The Federal Reserve System in 1913. The decay in the US Dollar purchasing power has slowed in recent decades.

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Although the decay in purchasing power has declined since 1980, the yearly change in purchasing power (blue line) continues and almost completely offsets the yearly growth in average hourly earnings.

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The REAL average hourly earnings for all employees has been declining since 2015 and is now just barely positive.

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We continue to wait for the miraculous growth in middle class earnings that politicians promise.

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