But in reality, only workers in two industries — leisure and hospitality and retail trade — are actually coming out ahead, once inflation is taken into account.
However, once inflation is factored in, paychecks actually shrank by 1.2% over that time period, the analysis found.
“Workers have had more bargaining power to get larger wages, but firms have also had power to set higher prices,” said Furman, also a former chair of the Council of Economic Advisors in the Obama administration. “And the prices are beating the wages.”
Where wages are rising
Leisure and hospitality workers, which includes waiters, cooks and hotel clerks, have been in high demand after being hit hard by job losses when nonessential businesses shuttered at the start of the pandemic. Their wages have grown by 0.9% since December 2019, after accounting for inflation, according to Furman’s analysis.
Retail workers, such as salespeople, cashiers and customer service representatives, have also been wooed by employers. This has led to a 0.2% inflation-adjusted bump in wages for them. Employment in this sector is 208,000 above its level in February 2020.
Employers in lower-wage industries really had to boost pay in order to hire and maintain the staff needed to meet demand in 2021, said Skanda Amarnath, executive director of Employ America, which advocates for a high-wage, high-employment economy.
“Right now, CPI is just way too strong relative to everything else,” he said of the Consumer Price Index, a popular inflation measure.
And where they are falling
In all other industries, inflation-adjusted wages have dropped since the end of 2019, led by utility workers with a 2.7% decline.
Those employed in construction and information technology have seen their pay slip by 1.8%, while manufacturing and financial sector workers have experienced a 1.7% drop.
Even wholesale trade workers, such as truck drivers, who have also been in demand during the pandemic as supply chains snarled, have lost ground. Their wages have declined 0.6% since December 2019. That’s a reversal from the end of 2021, when their pay was up 0.1% over the prior two years.
But the Fed looks at wage growth before the impact of inflation, and that has remained strong. The 5.3% jump over the year ending in June was the highest since the spring of 1983.