The redoubtable Wall Street Journal opinion page says that Bidenomics is a crock. The Census Bureau just released its estimate of annual income for 2022, and after adjusting for inflation it's fallen from the previous year:
The Census Exposes Bidenomics
Its annual report shows how inflation has gutted real household incomes.....Middle-class Americans who think they’re losing ground are right. The reason is that inflation has outpaced the earnings growth from work.
As usual, they're distorting the story. The main reason real wages have fallen is that they spiked upward in 2020 thanks mostly to statistical artifacts. As those artifacts faded away, the official numbers reverted to their old values.
That said, here are all the different measures of income that I could round up. All of them are measured from the final quarter of 2019 to the most recent quarter of 2023 using the usual CPI index. The exceptions are the Census Bureau numbers, which are annual and use the C-CPI chained index.
The Journal, naturally, is focusing on the worst number because it fits the point they wish to make. The reality is that, adjusted for inflation, almost every measure shows that average incomes are about flat.
That's nothing to write home about, but it's a far cry from the middle class being gutted during the Biden era.
POSTSCRIPT: It's worth noting that the CPI inflation index diverged considerably from the PCE index during the pandemic. Here's the same chart as above, but using the PCE inflation numbers consistently for everything:
The PCE index treats housing differently than CPI and was likely more accurate during the housing boom of 2021-22. However, I normally use CPI and I don't like to cherry pick based on what's convenient. That's why the main chart uses CPI.
The claim by the WSJ that earnings have crashed is uniquely absurd. Actually the media - at least the ones I read - have tended to run stories about how the job market is really tight and workers have the upper hand. It can't be both ways. But the numbers are not consistent with either story. After some funny business involving mostly compositional effects during the covid lockdown and recession, real earnings are back on the trend that started around 2011:
https://fred.stlouisfed.org/graph/fredgraph.png?g=18S3e
But it's not only the writers in the media who have been irresponsible and out of touch with reality. Supposedly responsible economists including the directors of the Fed have been claiming that it was wage demands that caused inflation, and that unemployment must be increased to prevent more inflation. It's no wonder that people are confused about the actual state of the economy when the media publish such a lot of nonsense about wages and inflation.
The WSJ is not "focusing on the worst number." They are focusing on the most meaningful and widely reported number. Obviously if you want to obfuscate, you can find a bunch of other, slightly less meaningful numbers to serve as dust in the eyes--though as an econ major I won't be fooled.
The WSJ is obfuscating by using a year/year number measured from the covid-year peak. That peak is at least partly spurious, caused by composition effects.
Clearly, as Kevin says and as also shown in the link in my comment above, earnings are not down from pre-covid level. For production workers they are actually up a little, following the pre-covid trend.
I don't read the WSJ, but I'll bet that you can find stories in it about how wages are too high and should be kept down by Fed action. That take represents the interests of employers, and the contradictory take that earnings are down is anti-Biden propaganda.
I marvel that Kevin continues to read the WSJ opinion page, or any opinion page for that matter. Outside a very few (Krugman, Tufekci), most of those folks have no idea they are talking about and are just writing words to incite an emotional response. But at least he ends up making graphs!
Oh, and I suspect the drop in household income could reflect increased retirements.
As they say, there are lies, damn lies, and statistics.
I blame bloggers, media pundits and the MSM with their sky is falling bullshit that has given people the false impression that the unemployment rate is near a 50-year high, rather than floating at a 50-year low for the last 12 months or so.
https://www.theguardian.com/us-news/2023/sep/15/biden-economy-bidenomics-poll-republicans-democrats-independents
I am going to start attacking people and outlets relentlessly for pushing dumb narratives that only seek to find warts.