A report recently released by the federal Labor Department on data identified as real earnings shows wages for Americans — both overall and specifically in the category of production and non-supervisory staff — increasing in December from the previous month faster than inflation.
In direct terms, that news obviously suggests a significant boost to the purchasing power seen by everyday Americans tied to what remain expansive opportunities for employment and inflation itself declining. In December, data from the Consumer Price Index — also produced by the same federal department — showed an overall 0.1 percent drop in prices from the prior month, meaning November of 2022. Costs for gas weigh significantly on some federal measurements for inflation, meaning the widely reported drops in those prices can represent far-reaching impacts according to federal metrics. In the recently released data from the Labor Department, the increase in real hourly earnings for all workers in December from the prior month was 0.4 percent, which factors in the 0.1 percent drop in prices.
Although the report indicated a drop in the average length of workweeks, at least for those subject to hourly wages, the same report also outlined a smaller jump of 0.1 percent in average weekly pay in December from the prior month for the same group. In December of last year compared to the year prior, average hourly and weekly earnings were still down for all workers, according to measurements that it appears also factor in the rate of inflation. The recorded one-year drop in average hourly earnings was 1.7 percent, while there was a 3.1 percent decline recorded in December compared to the prior year in average weekly earnings, with the gap evidently creditable in large part to declining lengths of workweeks.
The real earnings in December for production and nonsupervisory employees increased 0.5 percent compared to November, connected to what was an actually larger drop in the version of the price change data from the Consumer Price Index that reflected costs for a group classed as urban wage earners and clerical workers. “Real earnings indicate the purchasing power of earnings after adjustment for changes over time in the prices of consumer goods and services,” federal definitions note.
Other economic metrics that have recently provided positive signs include unemployment rates, with President Joe Biden recently touting progress seen in the rates recorded for individual states. In December of last year, three dozen jurisdictions — including 35 states and D.C. — saw their individual unemployment rates drop compared to those from December 2021, and the rates recently recorded for individual states including Alaska and Pennsylvania are the lowest seen in those states since that individualized data collection began.