Typical US worker out-earns inflation by $1,400 per year: Treasury report

As rising prices continue to be an issue for many Americans, it looks like things might be getting a little better. In July, the Treasury Department released its report on purchasing power that found the typical American’s income has increased more than prices have since before the COVID-19 pandemic.

The Bureau of Labor Statistics looked at Americans’ median weekly real earnings, which is how much money they made when adjusted for inflation. It found that compared to the same time last year, people’s real earnings went up 2.5%.

That means the median American’s purchasing power has improved . Purchasing power is what people are referring to when they say a dollar doesn’t go as far as it used to.

Here’s an example: Within the last 25 years, a person used to be able to go to the corner store and get two individual bottles of their favorite soda for just $1. Now, it’s almost $2 a bottle and the 2 for $3 deals are considered a score. That’s because in the past, a dollar had significantly more purchasing power than it does today.

The Treasury found that between June 2023 and June 2024, median American workers were able to buy the same amount of goods they could have in 2019 and still have some cash left over to spend or save — about $1,400 a year. That’s just about $54 every pay period if they get paid every two weeks.

So, while the Treasury’s report is good news for Americans overall, it might not feel like you’re reaping any benefits . A monthly survey of the Consumer Confidence Index found that while it rose to a six-month high in August, it remains below pre-pandemic levels.

A CNN poll released in July also found nearly 4 in 10 adults said they worry their family’s income won’t be enough to meet expenses.

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