Business

Americans Need A 30% Raise Just To Keep Up With Pre-COVID Prices

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Americans earning the same salaries they made before the COVID-19 pandemic have lost nearly a quarter of their purchasing power as consumer prices climbed more than 30% through September, according to federal inflation data.

A salary of $100,000 in January 2020 would need to reach approximately $130,612 in September 2026 to purchase the same amount of goods and services, according to data from the Bureau of Labor Statistics (BLS). The calculation highlights how years of accumulated inflation continued squeezing American households, even as workers received nominal pay raises that may fail to keep pace with rising living costs.

The Consumer Price Index (CPI), which measures changes in the prices Americans pay for everyday goods and services, climbed from 257.971 in January 2020 to 336.940 in September, representing a cumulative increase of 30.6%.

That means an American earning $75,000 before the pandemic would need roughly $97,959 today to maintain the same purchasing power. A worker earning $50,000 would need approximately $65,306, while someone making $150,000 would need nearly $195,917.

For workers whose paychecks have remained unchanged since January 2020, the purchasing power of those earnings has fallen approximately 23.4%, according to calculations based on federal inflation figures.

The surge in prices followed trillions of dollars in federal pandemic relief approved under both President Donald Trump and former President Joe Biden. Congress enacted roughly $5.6 trillion in COVID-era spending measures, including the CARES Act under Trump and Biden’s $1.9 trillion American Rescue Plan, according to the Congressional Research Service. The massive influx of federal stimulus helped contributed to inflationary pressures as pandemic-related supply disruptions constrained production. Economists’ warned at the time additional government spending risked driving prices higher.

The erosion of purchasing power comes as inflation accelerated again in September, with consumer prices rising 3.7% over the preceding year, compared with 3.4% in August.

Gasoline prices surged 9.1% in September alone and were 34.2% higher than a year earlier. Fuel oil prices jumped 74.2% annually, while the broader energy index climbed 20.4%.

The latest inflation report also revealed that Americans’ wages are once again struggling to keep up with rising prices.

Real average hourly earnings, which account for inflation, fell 0.5% between August and September, according to the BLS. Inflation-adjusted hourly earnings declined 0.7% compared with September 2025, meaning average wage increases failed to compensate workers for price growth over the previous year.

The national CPI represents an average across a broad basket of consumer purchases, however, and does not necessarily capture the individual inflation experience of every household.

The BLS acknowledges that households with spending patterns that differ from the national average can experience substantially different changes in their living costs.

The Iran war helped drive U.S. diesel prices to a record $6.53 per gallon, sharply increasing transportation and agricultural costs. Record diesel prices have squeezed farmers during harvest season and could push grocery prices higher as increased production and freight costs work their way through the food supply chain.

Cost of living remains one of the top issue for voters as November’s midterm election approaches, with voters blaming Trump and Republicans for inflation, in large part due to the U.S. and Israel’s war against Iran.

An August Reuters/Ipsos poll found that 47% of registered voters considered the cost of living the single most important factor in deciding their congressional vote, while 71% of Americans disapproved of Trump’s handling of the issue.