'That raise meant nothing': Inflation is wiping out pay increases for most Americans

[brooklynite]

Source: Washington Post

“That raise meant nothing,” said Stehlik, 23, whose roommate works at the same hotel. “I’ve got student loans. My roommate’s got medical debt. Most of my co-workers work two or three jobs, and they’re still having difficulty making ends meet.”

After years of barely budging, wage growth is finally at its highest level in decades. A global pandemic, combined with swift government stimulus and unexpected labor shortages have put workers in the driver’s seat, giving them the kind of negotiating power they had never imagined.

But in an unexpected twist, the same strong economic recovery that is emboldening workers is also driving up inflation, leaving most Americans with less spending power than they had a year ago.

Although average hourly wages rose 4.7 percent last year, overall wages fell 2.4 percent on average for all workers, when adjusted for inflation, according to the Labor Department.

Read more: https://www.washingtonpost.com/business/2022/01/22/wages-inflation/

[TreasonousBastard]

1. Along the same lines, after noting that SS increases were usually matched by Medicare increases...

I was recently "enjoying" food stamps and got a notice that thanks to some other increase, my food stamp allocation was being reduced form 20 bucks to 10 bucks a month.

America, what a country...

[AllaN01Bear]

2. i could tell when we would be getting a cola. the $ of a wash would go mysteriously up

in my apartments wash room

[TreasonousBastard]

6. The bastids think we don't notice. We do, but the killer is that it makes no difference.

[johnthewoodworker]

3. You wanna' fix things. Tax the rich.

[Alexander Of Assyria]

11. America awash in money..tax the rich and cut the damn military ffs. Can't afford it.

Now the 800 billion dollars a year money eater will want its inflationary cut…5% for inflation? 40 billion right there.

[SharonAnn]

54. Tax corporations. They used to pay 30% of gov't revenue. Now about 5%.

[Jon King]

4. Midterms gonna be ugly.

Inflation, crime reports on every news cast, low Presidential approval ratings. Unfortunately we are going to get hammered this time around. Does not matter what or who is to blame, voters take it out on who is in power.

[ck4829]

7. And it seems as though we don't want to do anything about it

The "return to normal" includes politics being like a pendulum.

Unfortunately, that ignores how nakedly insane the other side of the aisle has become though.

[doc03]

5. I worked for 50 years and went on strike once for

100 days and once a full year. We got a raise and the cost of things just went up. You work for a living you will never gain a f----g thing. That's something I said all along about a $15 minimum wage prices will go up on everything wiping it out.

[thesquanderer]

8. re: "I said all along about a $15 minimum wage prices will go up on everything wiping it out."

Someone whose wage goes up from $14 to $15 may well quickly have their "raise" wiped out by inflation. But people whose wage goes up to $15 from $7.25 is going to be ahead of the game for years no matter what, unless we start seeing annual inflation of 100%. Even someone getting a raise from $10 to $15 is going to be able to stay ahead of inflation for a good while, even if inflation goes back to what we saw in the 70s.

[doc03]

27. I can see $15 even more in San Francisco but in Ohio

the cost of living is far less. Wasn't the minimum wage supposed to increase over several years to $15 I can agree with that but not 150% raise immediately. I think the
minimum wage in Ohio went to $9.30 on January 1st
and everyone raised their prices the same day. The employers either cut their labor force or raise prices the increase never ever comes out the CEOs pay.

[ck4829]

9. Wiped out by billionaires becoming multi-billionaires

Last edited Sat Feb 12, 2022, 03:45 AM - Edit history (1)

Billionaires Cause Inflation

[Scrivener7]

13. Where I live, the $15 minimum wage is double the previous minimum wage. Have prices doubled

while I wasn't looking?

[ck4829]

14. It's silly, really. People are getting paid peanuts, give them a few more peanuts

And we're suddenly in an economic meltdown?

It's the 2008 recession arguments all over again, the people with power finding some way to tie the problem to people without power. We should be tired of the lies and the bull.

[Scrivener7]

15. Yup. Fomenting panic tends to make people vote republiQan and they know it.

The media is all in on it.

[gab13by13]

10. I just heard on TV that people's savings have skyrocketed.

Not just rich people's savings.

[Scrivener7]

12. The vast majority of inflation is coming from meat, used cars and oil.

When you average overall wages for all workers, you assume everyone is buying a used car and eating lots of meat and uses lots of oil to heat their home, etc.

None of these is true, or few of them are true for most people. Those three commodities skew the average, yet most people didn't buy a used car, many people don't buy lots of meat, and a vast swath of the country doesn't consume a lot of heating oil.

For most of us, the impact of the inflation is much lower than this stated average.

[inwiththenew]

24. There are thousands of things made from petroleum that are affected by the increase

in the price of oil. I bet you could walk around your house and find dozens of those things right now.

Lipstick
Sunglasses
Deodorant
Soap
Tooth Brushes
Toilet Seats
Shoes
Clothing
Mops
House Paint
Garbage Bags
Shampoo
Tape
Curtains
Nail Polish

That's just off the top of my head. There are thousands of products that are manufactured using petroleum in some way other than as a fuel to transport it. Now obviously they haven't jumped as much as like gasoline and heating oil because the petroleum is a smaller percent of the make up but they will still be driven up by more expensive petroleum.

[Scrivener7]

25. Do those things make up a large proportion of your typical spending?

Suggestion: for clothing, buy natural fibers. Petroleum based fabrics just end up in landfills. And buy fewer clothes. Fast fashion is choking our oceans.

[Calista241]

29. Everything you buy, eat, look at, or use throughout any given day has an oil cost associated with it

Everything you buy needs to be transported, whether it's trains, trucks, bicycles or ships, all of it requires a shit ton of both oil and oil derivatives.

Excluding transportation costs, most products out there use oil derivatives either themselves, or in their manufacturing process.

Anything electronic or anything that has moving parts has oil itself or oil derivatives in it. Even clothing made from natural fibers (or anything else talking about their 100% natural or climate friendliness), the machines that make them are heavy consumers of oil derived products and lubricants.

Exxon, BP and other oil companies are not going out of business anytime soon. If every new car sold was electric, and gasoline and diesel powered cars and trucks were magicked out of existence; BP, Exxon, and other oil companies will still be gigantic and successful multi-national corporations with significant revenues and power.

[Scrivener7]

32. So higher prices in oil are a good thing. They'll make us figure out how not to be so

dependent on this thing that is ruining our world and our health and our lives.

[Calista241]

33. It's going to be very, very hard to find other sources for lubricants, plastics and other oil

derivatives. Especially at the scale required for modern societies.

In addition, Russia, Iran, the Saudi's and other petrostates will thank us for supporting their economies and war machines with sky high oil prices.

[MichMan]

36. Should that be a campaign message for the midterms?

"Higher oil and gasoline prices are a good thing"

[Scrivener7]

37. Why would you think that should be a campaign message?

That's just dumb.

[MichMan]

39. You said higher oil prices were good

I merely commented that it that was the case, should people campaign on that message?

[Scrivener7]

40. Would you? Because as I said, that's just dumb.

Don't campaign on this either: The stock market is tanking right now. It's a good thing because it was way over-valued and if it doesn't let off steam it will burst like a bubble. But lots of people are losing money.

Don't campaign on this either: Omicron happened during Joe's administration. It's an awful disease, but it's not as bad as other variants and scientists are hopeful that its wildfire spread might give many people better immunity against future variants.

Sometimes we have to hold two thoughts in our head about the same thing, and not all events with beneficial outcomes make good campaign slogans. Nor should they.

Let me know if you are still all perplexed about this and I'll try and explain it in even simpler terms.

[MichMan]

42. Well I wouldn't, because unlike you, I don't believe any of those are good

As a very recent retiree with an IRA, I do not think losing tens of thousands in investments is at all good for me.

I don't believe it is good for anyone to catch a viral disease

And I don't believe higher energy prices are good for people driving to work, heating their homes, and wondering why everything costs more.

So, I wouldn't campaign on any of them, but you can bet the Republicans will

[Scrivener7]

43. So we can dispense with your sea lioning and return to the

original subject.

Inflation is being vastly overstated because most people are affected much less than the stated average. As Democrats, we can help ourselves by not feeding and amplifying silly republiQan hysteria propaganda that frames this inflation, small by historical standards, as a catastrophe.

Though I realize that some won't get that, will argue the republiQan's propaganda for them, and will shoot Democrats in the foot.

[ruet]

16. Dead-end Capitalism Strikes Again -NT-

[maxsolomon]

17. You know what will fix it, 23 year old?

It isn't electing Repukes.

[ck4829]

18. Indeed. More Republicans, more billionaires... no counters to inflation

Billionaires Cause Inflation

[Calista241]

30. We (meaning Dems and Joe Biden) will be the ones to fix it.

Interest rates are going to go up 4-6 times this year, and that is going to be very unpopular. It's what is necessary though, and it needs to be done to fix the economy.

The Fed reports to the President, and Biden is in office until 2024. After 18 months - 2 years of interest rate increases, inflation will probably start to come down in 2023 or 2024.

[Luciferous]

19. Our health insurance just went up so my husband's raise is going to just about cover that 🙄

[chowder66]

20. While I can sympathize, think of what it would be like without the increase. nt

[SWBTATTReg]

21. Hey, this is what it has been like for decades. Low wage gains, and constant price

increases since the 1980s. Nothing new here other than the fact that the 23-year-old is finally noticing this? I guess having to pay their own way perhaps focuses one's attention on stuff.

[tishaLA]

22. Katie Porter said on LO'D

that *even accounting for inflation* the average worker has $340-something more income per month than last year. Maybe she's wrong and the WashPost is right, but she usually has her facts in order.

Found the clip....

Link to tweet

[onenote]

23. The Post was quoting the Labor Department. Not sure where Katie got her number.

And Katie didn't explain the basis of her assertion that the average family has $354 more per month (including the relevant period on which her assertion was based).

I think a lot of "average" families would be surprised to learn they are more than $4200 ahead of where they were (taking into account inflation) than some recent point in the past, particularly with studies asserting that inflation added $3500 in costs to the average family's budget last year.

[cadoman]

28. thank you for that, it's something to share to set people straight

The numbers on that board are simply beyond dispute. You have $354 more every month and your stupid ass doesn't even know it. (and yes that was inflation included!)



People are acting like it's going badly when it's actually going very well. Fact check: check your damn wallet and count the extra cash! Also make sure we get the IRS funded so everyone is paying the cash they fucking owe us.

[JCMach1]

26. Meanwhile the end of cheap money is melting the markets and will soon

Melt real estate...

[Emile]

31. Predatory Capitalism is who to blame for inflation!

My financial advisor warned me before the election about voting for a socialist. I told her I was more worried about Predatory Capitalism than socialism.

[Hortensis]

47. This is planet-wide pandemic-caused inflation. And, of course,

increased wages are both a great effect of shaking up AND an inflationary factor.

[dchill]

34. The best they will EVER do for us is allow us to keep treading water...

...so much winning!

[Hortensis]

48. WE are over 250 MILLION, and "they" are a few thousand.

Maybe time to stop whimpering hopelessly about how powerful they are and just vote to put an end to them? Please look at Pelosi's statement at the bottom. She's not whining, she's trying to wake the electorate up to do their job before it's too late: Vote to get rid of them!

"They" never did anything we didn't first enable. By voting what they wanted. Or by not voting, pretty much the same effect -- they love nonvoters. That's why they work so hard to keep us from voting and corrupting the understanding of those who do vote, and of course now to destroy the power of our vote altogether. Wouldn't do to have us realize that "the best we've been doing for ourselves is allowing ourselves to keep treading water..."

Oh, btw, if we switched to socialism tomorrow, one guess who'd be there? Us and them. All the whiners who didn't learn to say no and all the grabbers who didn't like their new share one bit. And those of us who've always known what we could do and how to do it.

IT'S TIME TO START VOTING TO WIN. Before they finally succeed in eliminating our ability to stop them.

[yellowdogintexas]

35. for the most part, no raise I ever received made that much difference

in my finances. Wages have not kept up with cost of living since ...well forever

[tenderfoot]

38. Someone's having fun posting shitty news

[Scrivener7]

41. Everyone needs a hobby.

[brooklynite]

45. Must be fun living in a bubble of voices that agree with you...

I post items that are topical and newsworthy. You're under no obligation to read them.

[tenderfoot]

49. Must be fun posting with a tax payer funded pension that allots one such leisure time.

eom

[brooklynite]

50. My pension isn't "taxpayer funded", unless it's because I'm a taxpayer.

The New York State and Local Retirement System collects contributions from public employees and responsibly invests them.

Do I detect some resentment that I did public service for my entire career, instead of potentially earning more money in private sector?

[tenderfoot]

51. The resentment is due to your incessant bashing of Democrats/Liberals/anything left of Jesse Helms

eom

[brooklynite]

52. Feel free to elaborate. As I recall, we were discussion inflation and the media.

[peppertree]

44. Doesn't it always though

Except for the Clinton years, real wages have pretty much been on a treadmill since '73.

Being a homeowner is the only way most people have been able to get ahead - but of course, not everyone can.

[jgmiller]

46. This won't be a popular opinion but...

There is inflation caused by wage increases or scarcity of product or materials and there is inflation caused by consumers. The reasons are never clear cut and there is always a mixture but I completely believe the majority of this inflation cycle is being caused by consumers.

When I say caused by consumers I mean that by continuing to consume things other than basic products at this rate we are encouraging companies to raise prices. The company I work for has raised prices about 20% in the last 6 months while our cost of those goods has only gone up about 8%. Why have we done that? Because EVERYONE else is and so why wouldn't we?

The basics of capitalism is that you maximize profit by cutting costs and raising prices until the market tells you that you have raised prices too much. How does the market tell you that? It stops buying from you. Capitalism does work but we have created a society that just spends insane amounts of money and then complains that we have no money and that things cost too much. Stop buying! As soon as enough people do that companies will stop raising prices and even cut to get rid of excess inventory.

[Scrivener7]

53. Great post!

[ck4829]

55. Kick

[JCMach1]

56. The housing issue is horrific

Don't get me started