Despite higher paychecks, Americans still have less money to spend, Labor Department report says
Katherine oversees editorial operations across all six brands. Before joining The Meridan Group, she spent 14 years at the Minneapolis Star Tribune, where she led the metro desk through its digital transformation. She holds a Master's in Journalism from Northwestern's Medill School.
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(Gray News) - Although Americans are seeing bigger paychecks on paper, they still have less money to spend.According to the U.S. Department of Labor’s Employment Cost Index, the total compensation for civilian workers, including wages and benefits, rose 3.4% over the last 12 months, ending in September. Wages and salaries were up 3.1%, while benefit costs climbed 3.9%.After adjusting for inflation, however, wages are effectively shrinking, according to the report.For private-sector workers, inflation-adjusted wages and salaries fell 0.6% over the past year, according to the Labor Department. For state and local government workers, real wages slipped 0.5%. That means price increases are outpacing pay gains, lowering workers’ purchasing power even as employers appear to be spending more on compensation.The report shows that pay raises are not keeping up with the cost of living, which is a major frustration for many American households. The report also highlights a challenge for the Feder