Study: Americans’ pay hasn’t fully recovered from inflation. Will it ever?
For 13 years, the 3% annual salary boost that Ricardo M. could count on every October felt like a beacon of stability and a nod that his loyalty as a plumbing supply salesman was being rewarded.
But in the aftermath of a post-pandemic inflation surge, those raises have since lost their luster. His grocery bills have doubled. The cost of filling up his Toyota 4Runner has jumped to $70 a week, and he’s had to dip into his savings to avoid taking on credit card debt. All the while, his pay increases have stayed the same.
“Inflation has taken it all,” says Ricardo, a California resident who requested that his last name be abbreviated, so he could speak freely about his employment situation. “I know costs are going up everywhere, and I understand that a business has to make money and stay profitable. But at the same time, don’t forget about the people who are bringing you business. I don’t make enough for the sales that I generate.”
Economists have celebrated inflation’s rapid dissent, and perhaps even more, the relatively little pain it’s caused the U.S. job market. For over a year now, wages have been rising faster than inflation as prices slow and the job market holds up, giving Americans an opportunity to recover the buying power that they lost after ultralow interest rates, supply shortages and a stimulus check-fueled spending boom combined to form the worst inflation crisis in 40 years.