How Much Value Did the Residents of the USA and EU Lose Due to Inflation from November 2021 to November 2022? 

Author: Shaneya | Date: December 19, 2022

Inflation is a rate of increase in prices over a given period of time. In U.S. from November 2021 to November 2022 the inflation rate was 7.1%, according to the U.S. Bureau of Labor Statistics.

In December this year, the U.S. Bureau of Labor Statistics released a report on the annual inflation in the United States. Talking about the increase of consumer price index, the report says the following:

“The all items index increased 7.1 percent for the 12 months ending November.”

However, although the prices went up 7.1% between November 2021 and November 2022 in the United States, the hourly earnings didn’t go up, they actually went down.

Between November 2021 and November 2022, the average hourly earnings for all employees decreased 1.9%.

In December this year, the U.S. Bureau of Labor and Statistics released a report about earnings in the United States. The report says the following:

“Real average hourly earnings decreased 1.9%, seasonally adjusted, from November 2021 to November 2022.” 

Seasonally adjusted means that the specific effects of a particular season were taken out of the equation. Seasonal adjustment is done to see what the real rate of increase or decrease in particular phenomena is over a given period of time, regardless of the influence of the season.

Since inflation in the United States is up 7.1% from November 2021 to November 2022, the United States citizens on average lost 7.1% of value during that time.

The hourly earnings in the United States are down 1.9% from November 2021 to November 2022, so the Unites States citizens lost 1.9% of value because of that too.

7.1% of value lost, plus 1.9% of value lost is 9% of value lost. The Unites States citizens on average lost 9% of value between November 2021 and 2022 due to inflation and decrease in hourly earnings. 

Now let’s look at Europe. In the European Union between November 2021 and November 2022 the inflation rate was 11.1%.

In December 2022, Eurostat, the statistics agency of the European Union, made a report about annual inflation, which states the following: 

“European Union annual inflation was 11.1% in November 2022.”

Hourly earnings in the European Union did not go down, they had a slight increase. Labor cost in the European Union increased by 3.4% from the third quarter of 2021 to the third quarter of 2022.

In December 2022, Eurostat made a report about the annual increase in labor cost, which states:

“In the third quarter of 2022, the hourly labour cost rose by 2.9% in the euro area and by 3.4% in the EU.”

Since the inflation rate in European Union between November 2021 and November 2022 was 11.1%, the residents of the European Union on average lost 11.1% of the value in that period.

Since the labor cost in European Union increased by 3.4% from the third quarter of 2021 to the third quarter of 2022, the residents of the European Union on average gained 3.4% of the value in that period.

11.1% of the value lost due to inflation and 3.4% of the value gained due to labor cost increase means that the median resident of the European Union still lost 7.7% of the value between November 2021 and November 2022.

So considering inflation and labor cost changes, the median resident of the United States lost 9% of the value between November 2021 and November 2022, while the median resident of the European Union lost 7.7% of the value in that same period of time.