By: Brittany Bernstein – nationalreview.com – November 8, 2022
Rising inflation has dealt American workers their largest pay cut in 25 years, according to the Federal Reserve Bank.
Fifty-three percent of workers saw their wage growth dwarfed by the rate of inflation this year, according to an October report from the Dallas Fed. Despite having increased wages, the workers saw a median decline in inflation-adjusted wage growth of 8.6 percent in the second quarter of 2022 compared to the same period in 2021.
“Taken together, these outcomes appear to be the most severe faced by employed workers over the past 25 years,” the Dallas Fed said.
Over the last 27 years, the average median decline has been 6.5 percent, with real wage declines typically falling in the range of 5.7 to 6.8 percent, the report said.
“While the past 25 years have witnessed episodes that show either a greater incidence or larger magnitude of real wage declines, the current time period is unparalleled in terms of the challenge employed workers face,” the Dallas Fed said.
While Americans have seen a 5.1 percent increase in wages, they have had to contend with rising inflation. In September, the Consumer Price Index increased by 8.2 percent year-over-year.
Fox Business reported on the Fed’s statement on Tuesday as Americans headed to the polls. Inflation is expected to be a top issue for many voters in the midterm elections and could impact which party wins control of the House and Senate.
More than half of registered voters said economic issues are their top priority, according to a recent ABC News/ Ipsos poll. Twenty-eight percent said the economy was their single most important issue, while 22 percent cited inflation.
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