Canadians Are Becoming Poorer As 6.9% Inflation Rate Is Still Outpacing Wage Growth

Month after month after month, inflation exceeds wage growth.

Inflation continues to remain elevated.

October’s inflation number came in at 6.9% the same as was recorded in September.

Core inflation rose 5.05% in October, compared to 4.95% in September.

Gas prices jumped 9.2%, a key driver of inflation in October.

Meanwhile, price increases slowed somewhat for groceries, though those prices are still rising.

The big issue here is the relationship between inflation and wage growth.

Hypothetically, if an economy was booming, high inflation would be manageable, if wages were keeping up.

Inflation could be 10%, but if wages were up 12% then people would – on average – be getting richer month after month.

Right now, the exact opposite is happening.

In October, average hourly wages rose 5.6%, far behind the 6.9% inflation rate.

Thus, Canadians are getting poorer.

This is something that doesn’t get enough attention, and it’s a reason why governments can often get away with inflationary policies for so long.

Many Canadians are seeing their wages go up.

They see themselves making more money.

But somehow, that money just doesn’t go as far.

It’s then easy to pin the blame on places that sell things, like grocery stores and gas stations.

Yet, ‘higher prices’ are really better described as ‘less valuable money.’

More ‘units’ of money don’t help people get ahead if each unit is worth less and less.

It is essential for Canadians to understand this, because politicians like Jagmeet Singh and Justin Trudeau are hoping to exploit ignorance in order to pin the blame for their destructive inflationary policies on ‘big corporations’ when the blame really lies with the federal government and central banks.

Spencer Fernando

Photo – Twitter

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