Wages Up: But are Employees Better Off?
The U.S. Bureau of Labor Statistics released its “Employment Cost Index” report on Friday, July 29th, for the second quarter of 2022. According to this report, “Wages and salaries increased 5.3 percent for the 12-month period ending in June 2022… Benefit costs increased 4.8 percent over the year.” This was on top of a 3.2 percent increase in wages for the 12-month period ending in June 2021.
In most recent years, this would be a good thing for employees, but with inflation currently running at over 9% for the year ending in June 2022, workers are actually losing 3.8% in purchasing power. (9.1% inflation minus 5.3% wage increase equals -3.8% purchasing power.) So the answer is that in 2022 workers are NOT better off.
Annual Inflation was 5.4% in June of 2021, so a 3.2% increase in wages left workers 2.2% in the hole last year as well.
The following table shows the annual increase in Total Civilian Compensation (i.e. Wages & Benefits) each June compared to the inflation rate for that year. [Read more…] about Is the Average Worker “Falling Behind”?