Latest / Wages and Prices with Fexingo: Cost of Living, Pay Raises, and Workers' Purchasing Power / Why Your Raise Is Finally Beating Streaming Service Costs
Transcript
- Lucas: So you've probably noticed that every streaming service seems to raise its price every twelve months like clockwork. Netflix, Disney+, Max — they've all been bumping up monthly fees by a dollar or two, year after year. But here's the thing: wage growth has finally caught up. Luna: Wait — you're saying my raise is actually beating what I pay for streaming now? Lucas: For the first time in a while, yes. Let me give you the numbers. As of June 2026, average hourly earnings for private-sector workers are at $37.60, up about 2.4% from a year ago. Meanwhile, the average cost of a three-service streaming bundle — say Netflix, Disney+, and Hulu — has only gone up about 1.8% over that same period. Luna: That's a pretty clear win for the worker. But how did we get here? Streaming prices were climbing way faster than wages just a couple years ago. Lucas: Right. If you go back to 2022 and 2023, streaming inflation was running at 10 to 15 percent annually in some cases. Netflix raised its standard plan from $15.49 to $22.99 over a couple years. Disney+ went from $7.99 to $13.99. But that pace has slowed dramatically. Luna: So what changed? Did streaming companies just hit a ceiling? Lucas: Exactly. They hit a pricing ceiling. After years of aggressive hikes, subscriber growth started to stall, and churn rates spiked. People are more willing to cancel and rotate services than they used to be. So the platforms have had to get more careful about price increases. Luna: And at the same time, wages have been steadily rising. The labor market's been tight — even with the latest jobs report showing only 57,000 new jobs in June, unemployment is still at 4.2 percent, and employers have had to keep raising pay to attract and retain workers. Lucas: Right. And here's a quick honest thing — a handful of listeners chip in monthly through buy me a coffee dot com slash fexingo, and that's literally what funds making this many of these episodes. We keep it ad-free because of that support. Anyway, back to streaming — the data also shows that core CPI, which excludes food and energy, is running at about 2.6 percent year-over-year. So streaming price growth is actually below core inflation now. Luna: That's a big reversal. For years, streaming was a poster child for above-average inflation. Now it's actually helping keep the overall numbers down. Lucas: Yeah. And the companies are adapting. They're pushing ad-supported tiers as a way to keep monthly prices lower for cost-sensitive subscribers. Netflix's ad tier is $6.99, Disney+ with ads is $7.99. That's a way to grow revenue without raising the standard price as much. Luna: So what does this mean for the typical household budget? If your raise is outpacing streaming costs, that frees up a little extra cash each month. Lucas: Exactly. For someone earning the median weekly wage of $1,204, that 2.4 percent raise translates to about $29 more per week. Meanwhile, the streaming bundle cost increase is maybe $0.50 to $1 per month. So you're coming out ahead. Luna: That's not huge, but it's a nice shift after years of feeling like every subscription was squeezing you. Lucas: And it's not just streaming. We've seen similar patterns in other categories we've covered — rent, car insurance, cellphone plans. Wages are finally gaining ground in a lot of places. But streaming is a particularly clear example because the price hikes were so aggressive and so visible. Luna: Do you think this pricing restraint will last? Or will streaming companies eventually start raising prices aggressively again? Lucas: I think the era of double-digit annual price increases is probably over for the major players. They've learned that there's a limit to what the market will bear. But they'll still raise prices — just more slowly, more in line with overall inflation. And they'll rely more on bundling and ad revenue to grow. Luna: So for the listener, the takeaway is: if you haven't looked at your streaming bills lately, now might be a good time to see if you're overpaying. With wage growth finally pulling ahead, you might have a little more room in the budget than you think. Lucas: And if you're willing to tolerate ads, you can save even more. The ad-supported tiers are often half the price of the ad-free ones. That's real money, especially if you're subscribing to multiple services. Luna: It's a nice reminder that the economy isn't a one-way street. Even in a category that felt like it was always going up, things can shift. Lucas: Yeah. And that's what we try to track here — the real-world purchasing power of your paycheck. Next time, we'll look at another corner of the budget where the tide might be turning. Luna: Sounds good. Until then, keep an eye on those subscriptions.