- by New Deal democrat
Because in the first few months of the pandemic during the lockdowns there was a spurt of deflation as shown above in the first graph, in the below graph I’ve normed the values to 100 as of May of last year. In the 9 months since, total inflation has been up 3.5% (for a 4.7% annual rate), while inflation ex-energy has risen 2.0%, (for a 2.7% annual rate):
Now let’s take a look at how inflation has affected real wages.
That was the case for March. Real wages declined -0.5%, and are -3.1% off their all-time high set last April: