# Wages vs consumer prices | PIER20 benchmarks Have private-sector hourly earnings kept pace with consumer prices? The wages vs consumer prices benchmark compares average hourly earnings of production and nonsupervisory employees with the CPI-U headline index, both rebased to 100 at their shared start. A wage line above the CPI line means wages have outpaced consumer prices, so workers' real purchasing power has grown; below means prices have eroded wage gains. The summary callout shows this as a real wage index. As of **June 2026**, the Average hourly earnings line stands at **187.6** and the CPI-U line at **166.5** (both base = 100 at the shared start). The Average hourly earnings line is up 3.4% over the past year and above its long-run median of 127.4. ## Summary statistics (full history) | Series | First | Latest | Min | Max | |---|---|---|---|---| | Average hourly earnings | 100.0 | 187.6 | 100.0 | 187.6 | | CPI-U | 100.0 | 166.5 | 100.0 | 167.2 | ## Last 24 readings | Date | Average hourly earnings | CPI-U | |---|---|---| | Jun 2024 | 174.7 | 156.8 | | Jul 2024 | 175.0 | 157.0 | | Aug 2024 | 175.7 | 157.3 | | Sep 2024 | 176.3 | 157.6 | | Oct 2024 | 176.9 | 158.1 | | Nov 2024 | 177.6 | 158.5 | | Dec 2024 | 178.1 | 159.0 | | Jan 2025 | 178.8 | 159.7 | | Feb 2025 | 179.3 | 160.1 | | Mar 2025 | 180.2 | 160.1 | | Apr 2025 | 180.2 | 160.4 | | May 2025 | 181.0 | 160.6 | | Jun 2025 | 181.4 | 161.0 | | Jul 2025 | 182.0 | 161.3 | | Aug 2025 | 182.7 | 161.9 | | Sep 2025 | 183.1 | 162.4 | | Nov 2025 | 184.6 | 162.8 | | Dec 2025 | 184.7 | 163.3 | | Jan 2026 | 185.4 | 163.5 | | Feb 2026 | 186.0 | 164.0 | | Mar 2026 | 186.4 | 165.4 | | Apr 2026 | 186.7 | 166.5 | | May 2026 | 187.1 | 167.2 | | Jun 2026 | 187.6 | 166.5 | ## How to read this benchmark **What a high reading means.** When the wage line runs above the CPI line, real wages are rising: the same hour of work buys more consumer goods than it used to. When it falls, prices are outrunning pay, and workers are losing purchasing power even as their nominal wages rise. The summary callout expresses this as a single real-wage index that rises with real gains and falls with real losses. **How the real wage callout is computed.** The summary callout divides the rebased wage index by the rebased CPI index and multiplies by 100, so it starts at 100 and moves with the relative growth of wages versus prices. A reading above 100 means cumulative real wage gains since the start; below 100 means cumulative real wage losses. It is computed over whatever range you have selected, so it stays consistent with the visible window. **Why production and nonsupervisory wages.** CES0500000003 tracks hourly earnings of production and nonsupervisory employees, roughly 80% of the private workforce, so it captures the typical worker rather than management or high earners. That makes it the natural comparator for a consumer-price index, since it measures the pay of the people whose cost of living CPI tracks. Supervisory and high-earning pay has grown faster and would tell a different story. **Limitations.** Average hourly earnings is a measure of pay per hour, not total compensation: it excludes benefits, bonuses and employer-paid payroll taxes, all of which have grown as a share of total compensation. CPI-U tracks urban consumer prices for a fixed basket and is sensitive to the basket's composition. The real-wage peak in April 2020 is a composition artifact: pandemic layoffs fell hardest on low-wage service workers, mechanically lifting the average wage without anyone getting a raise. Treat the chart as context for purchasing-power trends, not investment advice. ## How this benchmark is used **Cost-of-living and real-wage tracking.** Labor market analysts and policymakers use the real-wage index as the standard measure of whether pay is keeping up with the cost of living. Sustained real-wage growth supports consumer spending; sustained real-wage losses suppress it. The summary callout is the form most cited in policy briefings and central-bank commentary. **Wage-price spiral monitoring.** Central banks watch for the feedback loop where workers demand pay rises to cover inflation and firms raise prices to cover wage costs. The real-wage index is one input: when nominal wages are running ahead of CPI after a supply shock, the risk of an embedded spiral rises, and the index shows whether workers are recovering or losing ground in real terms. **Consumer-spending and retail outlook.** Consumer-sector analysts and retailers use real wage trends to forecast discretionary spending: real-wage growth supports volume growth, while real-wage contraction shifts the mix toward price-led nominal sales and private-label substitution. The direction of the index over a six-to-twelve-month window matters more than any single month. ## Frequently asked questions **What is the current wages vs consumer prices?** As of June 2026, the Average hourly earnings line stands at 187.6 and the CPI-U line at 166.5 (both base = 100 at the shared start). The Average hourly earnings line is up 3.4% over the past year and above its long-run median of 127.4. **How often is this benchmark updated?** This benchmark is built on monthly data. The page is refreshed when the source publishes new observations; the freshness block below the chart shows the exact data-through date and when PIER20 last fetched the file. **What data sources does this chart use?** The chart is built from Average hourly earnings and CPI-U, sourced from Federal Reserve Economic Data (FRED). **Have wages kept up with inflation?** Over the full series, which begins in March 2006, yes. The real wage index currently sits near 113, meaning average hourly earnings have outpaced CPI by roughly 13% in real terms since the start. That hides large swings: real wages fell through the 2008 crisis, rose sharply (for compositional reasons) during the 2020 pandemic layoffs, then fell back as 2021-2023 inflation outran pay before recovering more recently. **What is the highest and lowest the real wage index has reached?** The real wage index peaked near 117 in April 2020, though that peak is a composition artifact: pandemic layoffs fell hardest on low-wage service workers, mechanically lifting the average wage without anyone getting a raise. The cyclical low near 98 came in mid-2008 during the financial crisis, when inflation outran wages before both collapsed together. **Why does the April 2020 real-wage spike not reflect a real pay rise?** It was a composition effect, not a pay rise. Pandemic lockdowns destroyed low-wage service jobs in hospitality and retail far faster than higher-wage jobs, so the average hourly earnings of the workers who kept their jobs rose mechanically. No individual worker got a 5% raise; the bottom of the wage distribution simply dropped out of the sample. **How is the real wage index computed?** The index divides the rebased wage series by the rebased CPI series and multiplies by 100, so it starts at 100 and rises when wages outpace prices. It is computed over whichever range you have selected, so the summary callout stays consistent with the visible chart window. A reading of 110 means wages have outpaced prices by 10% over the selected window. ## Methodology - Formula: Index CES0500000003 and CPIAUCSL to 100 at the first shared month; real wage = wage index / CPI index × 100 - Frequency: Monthly - Sources: Average hourly earnings (CES0500000003) https://fred.stlouisfed.org/series/CES0500000003; CPI-U (CPIAUCSL) https://fred.stlouisfed.org/series/CPIAUCSL. Data via Federal Reserve Economic Data (FRED). - Data through: June 2026 - Last refreshed: 11 Aug 2026 ## Related benchmarks - [Corporate debt / GDP](https://pier20.com/benchmarks/corporate-debt-to-gdp) - [Nominal GDP vs real GDP](https://pier20.com/benchmarks/nominal-vs-real-gdp) - [Federal surplus or deficit / GDP](https://pier20.com/benchmarks/federal-deficit-to-gdp) - [House prices vs median household income](https://pier20.com/benchmarks/house-prices-vs-income) Full interactive chart: https://pier20.com/benchmarks/wages-vs-cpi Disclaimer: research software output, not investment advice.