[boole1854]

Even without including employer health insurance costs, real wages are up 67% since 1980.

Source: https://fred.stlouisfed.org/graph/?g=1JxBn

Details: uses the "Wage and salary accruals per full-time-equivalent employee" time series, which is the broadest wage measure for FTE employees, and adjusts for inflation using the PCE price index, which is the most economically meaningful measure of "how much did prices change for consumers" (and is the inflation index that the Fed targets)

[fusionadvocate]

How has inflation behaved since 1980?

[0xffff2]

It's probably worth noting that the "real" in "real wages" indicates that the number is already inflation adjusted.

[boole1854]

It rose 2.75% per year (239% over 45 years).

Source with details: https://fred.stlouisfed.org/graph/?g=1JxIa

[fusionadvocate]

Can you walk me through how to reach this '239%' number? Thank you.

[boole1854]

You can hover over places on the chart to get exact values. In January 1980, the index was at 37.124. In April 2025, it was at 125.880.

Then calculate cumulative inflation as the proportional change in the price level, like this:

(P_final - P_initial) / P_initial = (125.880 - 37.124) / 37.124 = 2.39

This shows that the overall price level (the cumulative inflation embodied in the PCEPI) has increased by about 2.39 times over the period, which is 239%.

[sph]

The thing that bugs me to no end when talking about inflation in an historical context, is that everyone forgets to consider how the indexes of consumption it's calculated from (PCEPI, CPI, etc.) are NOT static, and very arbitrarily are changed over time, often to make inflation seem lower than it actually is for the consumer.

Overall, historical comparisons of inflation numbers are so imprecise to be practically worthless the longer the timescale. You can expect the real figure to be much greater in reality for consumers, given the political incentive to lie over inflation data.

[rgun]

1.0275 ^ 45 = 3.389

3.389 - 1 (to account for increase) = 2.38 ~ 239%