A pay raise does not always mean a paycheck goes further. New research found that from February 2021 to June 2022, real wages fell by more than 4% as inflation outpaced many workers’ pay increases. The impact lasted for many households, with 37% of workers in the study earning less in inflation-adjusted terms in December 2024 than they had four years earlier. Now, a similar squeeze is happening again. In July, the Consumer Price Index rose at a 3.4% annual pace, while hourly wages rose 3.2% over the same period. When prices rise faster than pay, purchasing power declines. That can make everyday expenses feel heavier, even when income is technically increasing.
Inflation Leaves Millions of Workers with Another Lasting Pay Cut
