With pictures and data, take a look at the changes in the purchasing power of the US dollar over the past century
Dancing alone
A WeChat friend recently lamented to me that it was rare to accompany his wife to the supermarket. When he came back, he couldn't help but sigh that the hundred-dollar bill was so useless. Purchasing power is less than half of what it was 10 years ago. It is about one-quarter to one-fifth of what it was 20 years ago. The increase in prices has been too great, and the increase in wages cannot keep up with it. He asked me if Know how the purchasing power of the U.S. dollar has changed over the years.
Inflation occurs in every economy, and the United States is no exception. According to the Consumer Price Index (CPI) released by the U.S. Bureau of Labor Statistics, we can calculate the purchasing power of 1 dollar over the past hundred years and the purchasing power of 1 dollar in 2016. The relative comparison results are detailed in the table below.
If these data are plotted, the following trends can be obtained.
It can be seen from this picture that the purchasing power of 1 US dollar 10 years ago was about 1.23 times that of today. Compared with 20 years ago, it was about 1.57 times. The purchasing power of 1 US dollar 80 years ago was 17.5 times that of today. This is The highest value in the past 100 years. In the past century, the most violent fluctuations in the purchasing power of 1 U.S. dollar corresponded to the economic crisis, and World War II. In the past thirty years, the changes in the purchasing power of the U.S. dollar have leveled off, corresponding to an annual inflation rate of about 2%.
Can American wages keep up with such an inflation rate? I called up the changes in the minimum hourly wage in the United States over the past 80 years, hoping to answer this question from one perspective. The results are shown in the table below.
Based on these data, the following trends are drawn.
From US$0.25 per hour in 1938 to US$7.25 per hour now, the US federal minimum hourly wage has increased 29 times in the past 80 years, exceeding the depreciation rate of the US dollar. , but Americans still complain that the growth rate of wages cannot keep up with the increase in prices. Therefore, in recent years, there have been increasing calls for raising the federal minimum hourly wage. As of January 2015, 29 states have taken the lead and increased the statutory minimum hourly wage. Wages are raised to a level higher than the federal standard. Many states are working to raise the minimum hourly wage to the $10.10 currently being discussed in Congress. Connecticut has taken the lead in passing legislation and will implement it in 2017, including Seattle, Some major American cities, including Los Angeles , have raised the minimum hourly wage to $15.
