Between 2019 and 2024, consumer prices in the US increased by 26% and the average weekly earnings of all private-sector employees rose by 28%. In other words, average earnings across the country grew 2% faster than nationwide inflation.
This FRED Blog post uses data from the US Bureau of Labor Statistics and recent research by Maximiliano Dvorkin and Cassandra Marks at the St. Louis Fed to discuss regional differences in the change of inflation-adjusted employee earnings during that time.
The FRED graph above shows growth of average hourly earnings between the first half of 2019 and the second half of 2024: The solid blue line tracks the St. Louis, MO-IL, metropolitan statistical area (MSA), and the dashed green line tracks the Atlanta-Sandy Springs-Roswell, GA, MSA. The dollar value of those earnings has been adjusted by their respective regional consumer price indexes and plotted as an index number with a value of 100 at the start of 2019.
The dotted red horizontal line helps compare their change over time. In the St. Louis region, inflation-adjusted earnings increased by 2.6%. In contrast, inflation-adjusted earnings in the Atlanta region decreased by 8.7%.
These differences illustrate the broad range of regional patterns documented by the St. Louis Fed researchers. They used a quarterly census of employment and wages to measure how well hourly earnings kept up with inflation in 21 large cities. In most of those cities, average wages increased more than prices and the regional disparities were mostly due to large differences in the evolution in the price of shelter.
For more about this and other research, visit the publications page of the St. Louis Fed’s website, which offers an array of economic analysis and expertise provided by our staff.
How this graph was created: Search FRED for and select “Average Hourly Earnings of All Employees: Total Private in St. Louis, MO-IL (MSA).” Click on the “Edit Graph” button, select the “Edit Line” tab to customize the data by searching for “Consumer Price Index for All Urban Consumers: All Items in St. Louis, MO-IL (CBSA).” Don’t forget to click “Add.” Next, change the units to “Index (Scale value to 100 for chosen date)” and select “2019-01-01.” Click on “Copy to all.” Next, type the formula a/b and click “Apply.” Select the “Add Line” tab and repeat the previous three steps: search for and add average hourly earnings and consumer price index data in “Atlanta-Sandy Springs-Roswell, GA (MSA),” change the units, and calculate the ratio between both data series.
Suggested by Diego Mendez-Carbajo.