Real wages are falling again.
US average hourly earnings adjusted for inflation dropped -0.3% YoY in September. That's the 5th straight month of decline.
Just seven months ago in February, real wages were growing at +1.3% YoY. Now we're back in negative territory.
The culprit? Inflation has stayed above 3% for six consecutive months while nominal wage growth slowed to just +3.0% YoY in September — the slowest pace since May 2021.
Nominal wages peaked at +4.2% YoY growth back in March. Since then it's been a steady slide downward.
Bottom line: paychecks are growing slower than prices. Americans are losing purchasing power in real time.
This matters for consumer spending, retail earnings, and the Fed's next moves. If wages can't keep up, something has to give.
US average hourly earnings adjusted for inflation dropped -0.3% YoY in September. That's the 5th straight month of decline.
Just seven months ago in February, real wages were growing at +1.3% YoY. Now we're back in negative territory.
The culprit? Inflation has stayed above 3% for six consecutive months while nominal wage growth slowed to just +3.0% YoY in September — the slowest pace since May 2021.
Nominal wages peaked at +4.2% YoY growth back in March. Since then it's been a steady slide downward.
Bottom line: paychecks are growing slower than prices. Americans are losing purchasing power in real time.
This matters for consumer spending, retail earnings, and the Fed's next moves. If wages can't keep up, something has to give.
