Americans are seeing the fastest wage growth in decades, and the majority of workers in a Bankrate survey say they've gotten at least some kind of income boost over the past 12 months.
But the hottest inflation in almost four decades could be keeping them from fully reaping those benefits.
Nearly half of workers (48%) got a raise this past year and 21% found a higher-paying job, including 8% who received both, according to Bankrate's September Pay Raise survey.
Just 39% didn't receive either one, the lowest in any prior iteration of the poll and significantly down from 56% in 2021, 50% in 2019 and 62% in 2018.
While it's been a boon for Americans' wallets, those gains are doing little to offset rising consumer prices. Just 2 in 5 workers (or 39%) who received a pay raise or found a better-paying job say their income has either kept pace or risen faster than consumer prices. Half of these same workers say their income fell behind.
"Inflation that has run at the highest levels in more than four decades has stripped buying power away from households of all walks of life," says Greg McBride, Bankrate chief financial analyst. "Even half of those receiving a pay raise, getting a promotion or taking on new responsibilities said that higher pay falls short of the increase in household expenses."
Key takeaways
- More than 3 in 5 workers (61%) have received a pay raise, better-paying job or both over the past year.
- Workers who received raises were most likely to earn them for performance-based reasons (36%) and cost-of-living adjustments (31%).
- Half of workers who either received a raise or found a better-paying job over the past year say their incomes have not kept pace with inflation.
- Most workers (61%) aren't worried about their job security, though 39% are worried.
Taken together, the majority of workers (61%) have received some sort of pay boost over the past year, whether that's from a higher-paying job, a raise or both, Bankrate's survey found.
Experts have attributed those widespread gains to one of the strongest labor markets in history, which is offering workers a significant amount of bargaining power. Employers recovered pandemic-related job losses at a rapid pace, with joblessness taking just two and a half years to return to its pre-pandemic low.
That compares with a decade-long recovery in the aftermath of the Great Recession of 2007-2009.
Not only has the labor market recovered, but employers' demand for workers has rebounded at a much quicker pace than the number of those available to take a position.
Foster writes for Bankrate.com.
