Journal Article
Did Inflation Affect Households Differently? A Look at the Postpandemic Inflation and Wage Growth Dynamics
Abstract: We analyze the heterogeneous effects of postpandemic inflation and disinflation by inspecting inflation and wage growth experienced across quintiles of household income and wage distributions. We find that after inflation peaked in June 2022, households and workers in the bottom 40 percent of the income and wage distributions have consistently experienced both higher inflation and higher wage growth when compared to the middle 40 and top 20 percent of these distributions. Comparing the cumulated growth of both variables, we observe that the bottom and middle 40 percent reach the end of 2024 with 4.5 percentage points more of cumulated wage increase than inflation since January 2019, while the top 20 percent ended the same period with close to 3.5 percentage points of increase in their cumulated purchasing power.
https://doi.org/10.26509/frbc-ec-202511
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Bibliographic Information
Provider: Federal Reserve Bank of Cleveland
Part of Series: Economic Commentary
Publication Date: 2025-10-06
Volume: 2025
Issue: 11
Pages: 11
Note: Replication materials for this Economic Commentary may be found at github.com/avdluduvice/LuduviceTruss-WilliamsWalker_InfWageGrowth.