From January 2021 to October 2023, national average wages and salaries grew by nearly $15,000, according to an analysis from Democrats on the U.S. Congress Joint Economic Committee (JEC) released Monday. That’s over $3,500 more than the increase in inflation during that same time period, the Democrats say.

JEC’s thesis is backed up by other economic data, which also shows that wage growth is now outpacing inflation growth. Per the U.S. Census Bureau, wages and salaries increased by 4.6% for the 12-month period ending in September 2023 and by 5.1% for the 12-month period ending in September 2022. Meanwhile, the Consumer Price Index for All Urban Consumers, or CPI-U, increased 3.2% from July 2022 to July 2023.

“Even though people might not realize it, their wages likely are increasing faster than prices are rising, at least at the moment,” says Jacob Channel, senior economist at LendingTree.

But there are many caveats, Channel says. For one, inflation growth actually outpaced wage growth very recently, from April of 2021 to early this year. Households won’t necessarily feel the difference immediately.

And averages can obscure what many are feeling on an individual level, he says. That average wages have potentially increased by more than prices doesn’t mean everyone is better off; there will always be households struggling to make ends meet, as other recent data shows. 

“It could take more time for rising wages to truly make up for how much higher prices have gone since the height of the pandemic,” says Channel. “Though, if they haven’t already, I’m confident that increases in wages will eventually totally offset the last few years of abnormally high price increases.”

The bad vibes economy

The JEC Democrats want to shift the conversation around inflation and wage growth because Americans’ opinions on the economy will play a major role in whether or not President Joe Biden is reelected next year. And as of now, those opinions are largely negative, despite a mostly resilient economy.

The disconnect between public opinion and general economic data has led to much hand-wringing among economists and the media about why the “vibes” are so bad. Many people are, financially speaking, doing okay, or even better than they were pre-pandemic, in aggregate.

There are any number of reasons why Americans feel negative about their finances. Though inflation is now cooling, prices are much more expensive than they were a couple years ago. This is especially true for major budget categories like housing, which remains unaffordable for many. Gas prices are finally falling, but some costs, including dining out, car insurance, and cars, are still rising, according to the latest data from the U.S. Labor Department. Consumer debt is rising, interest rates are pushing up borrowing costs, and wealthier Americans are pulling back on spending. The media coverage around inflation has also been largely negative.

And while wages may be growing now, Americans’ real incomes fell by 2.3% in 2022 compared to 2021. As Channel said, it will take time for households to feel the current wage growth and lower inflation in their budgets, especially when inflation has been a persistent topic of conversation for the past few years.

That said, price growth—spurred by the pandemic and Russian invasion of Ukraine—is declining while the unemployment rate has remained low, undoubtedly positive indicators. And though many Americans are down on the economy as a whole, they say their personal finances are doing well. Contradictions abound in the economy.

“All in all, I would say that the economy appears to be doing better than a lot of people might realize or be willing to admit,” says Channel. “This goes to show how much of a disconnect there can be between how people view themselves and how they view the ‘big picture.'”