Are wages keeping up with inflation?

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No. From September 2025 to September 2026, wages grew 0.11 percentage points slower than inflation. Nominal wages — the literal dollars earned regardless of cost of living — increased by 3.6% while inflation stood at 3.7%. When wage growth trails inflation, it indicates that workers are experiencing a decrease in purchasing power from the previous year.
Sep 2025 to Sep 2026

3.6%

Nominal average weekly wage growth
Sep 2025 to Sep 2026

3.7%

Inflation rate
The Bureau of Labor Statistics has published average weekly wage data for nearly 21 years, since March 2006. Looking back, average wages outpaced inflation 72.2% of the time.

Between Sep 2025 to Sep 2026, average weekly wages grew slower than inflation.

Difference in year-over-year change of average weekly earnings and CPI, Mar 2007 - September 2026

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A number of factors influence the nominal wage growth and inflation rates, including labor costs and the labor market itself. In May 2020, wages increased 7.5% over the previous year while inflation was at 0.1%, a record-high gap of 7.4 percentage points. This spike was attributed to pandemic labor market disruptions that disproportionately affected lower-wage jobs.
The biggest negative gap (-4.3 percentage points) was in June 2022, when nominal wages grew by 4.8% year over year while inflation hit 9.1%.

In September 2026, average weekly wages grew 3.6% YoY compared with an inflation rate of 3.7%.

Year-over-year change of average weekly earnings and CPI, Mar 2007 - September 2026

How have wages grown over time after accounting for inflation?

We can measure the effect of inflation on wage growth by comparing the nominal average weekly wage to its inflation-adjusted (or “real” wage) equivalent. Since March 2006, the nominal average wage rose from $685 to $1,301, a 89.8% increase. Once adjusted to September 2026 dollars, it went from $1,156 to $1,301, a 12.5% increase. The nominal wage growth was $615, but the real wage growth was $145.
WAGES
In September 2026, the average weekly wage was $1.3K.
Source: Bureau of Labor Statistics
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Between Sep 2025 and Sep 2026, the nominal average wage grew from $1,255 to $1,301 — $46 more a week, a growth rate of 3.6%. Accounting for inflation, the real wage growth was -0.11% or a decline of $1 a week.

Since March 2006, the nominal average wage grew by $615 per week. Adjusted for inflation, that's $145.

Average weekly wage, nominal and inflation-adjusted

Which states have the highest wage growth?

Real wage growth varies geographically. Over 12 months ending with Sep 2025 - Sep 2026, wage growth outpaced inflation in 10 states and Washington, DC, and the highest real wage growth was in New Mexico, at 4.1%. In 40 states, real wage growth was negative, meaning wages didn’t keep up with inflation; Wisconsin saw the steepest drop, with -5.1%.

Real wages increased in 10 states and Washington, DC.

Average weekly wage growth (Sep 2025 to Sep 2026)

Average weekly wage growth (monthly average from Sep 2025 - Sep 2026), by state

Average weekly wage growth (monthly average from Sep 2025 - Sep 2026), by state
1.

New Mexico

+4.1%
2.

Hawaii 

+2.9%
3.

Maryland 

+2.4%
4.

Missouri 

+1.8%
5.

District of Columbia

+1.5%
6.

Nevada 

+1.3%
7.

Alabama 

+0.34%
8.

Illinois 

+0.32%
9.

Louisiana 

+0.18%
10.

Pennsylvania 

+0.09%

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Methodology

USAFacts standardizes data, in areas such as time and demographics, to make it easier to understand and compare.

Page sources

USAFacts endeavors to share the most up-to-date information available. We sourced the data on this page directly from government agencies; however, the intervals at which agencies publish updated data vary.