Latest / Wages and Prices with Fexingo: Cost of Living, Pay Raises, and Workers' Purchasing Power / Why Your Raise Is Finally Beating the Cost of Staying Home
Transcript
- Lucas: There's this piece of conventional wisdom that's been repeated so often it's practically a gospel: if you want to save money, stay home. Don't go out to eat, don't travel, don't go to concerts. Just be a homebody. Luna: Right, the whole 'staycation' and 'nesting' narrative. But lately, that advice feels less solid. Lucas: It's not just a feeling. The June CPI report, out the other week, shows shelter costs up 4.2 percent year over year. But within that, there's a less discussed category: home maintenance and repair services. That line item jumped 8.1 percent. Luna: Eight point one percent. That's more than double headline inflation. Lucas: Exactly. And this isn't a blip. The Bureau of Labor Statistics has been tracking it for a while. Plumber rates alone are up 6.3 percent over the last twelve months. Electricians? 7.2 percent. Your dishwasher breaks, your water heater dies, a pipe bursts — the bill to fix it is climbing significantly faster than your paycheck, historically. Luna: So the old 'just stay home and save' advice ignores the fact that staying home costs money too. Lucas: Which brings me to the good news, actually. Because this is a show about whether your raise is finally beating these costs. And the data suggests — for the first time in years — that it is. Luna: Wait, really? Even with home repair costs up 8 percent? Lucas: Here's the key: average hourly earnings for private workers hit $37.60 in the June survey. That's up 4.8 percent from a year ago. The employment cost index for wages — a broader measure — rose 4.6 percent. Both are now running ahead of the shelter and home maintenance inflation numbers. Luna: So wages are growing faster than the cost of keeping your home in working order. Lucas: That's right. It's a reversal of the pattern we saw from 2021 through 2024, when wage growth consistently trailed shelter-related inflation. Back then, your raise bought you less home repair, less utility consumption. Now the arithmetic has flipped. Luna: And that matters because home maintenance isn't optional. You can skip a restaurant meal. You can't skip fixing a leak. Lucas: Exactly. So the real measure of purchasing power for a typical worker is: how many hours do you have to work to afford a plumber's hour? That ratio is improving. In 2022, the average plumber cost 1.15 times the average wage. Now it's down to about 1.08. Luna: That's still more than one hour of work for one hour of plumber time, but the gap is closing. Lucas: Right. And if you look at the broader home maintenance category — which includes things like lawn care, pest control, appliance repair — the ratio improved from 1.3 in early 2023 to 1.18 today. Luna: So your raise is finally beating the cost of staying home. But I imagine that doesn't feel obvious to most people. Lucas: That's the thing about inflation — it's cumulative. Even if the rate slows, the price level is still higher. So a homeowner might still be paying $250 for a service call that was $200 a few years ago. But their raise is now covering more of that increase than it used to. Luna: And that's the story we've been tracking across different categories all season. Car repairs, insurance, streaming — now home maintenance. Lucas: Honestly, if this episode made that a little clearer for you — or if you're one of those people who's finally seeing your paycheck outrun your home repair bills — and you want to help keep this show ad-free, you can support us at buy me a coffee dot com slash fexingo. Luna: Yeah, it's the smallest ask. Like, literally the price of a coffee. Lucas: One more layer here: there's a regional component. The BLS data shows that in the South, home maintenance costs rose 9.2 percent year over year — faster than the national average. In the Northeast, it was only 5.8 percent. Luna: So if you live in the South, your raise might not be beating those costs yet. Lucas: It's close. Average hourly earnings growth in the South is also above 5 percent — around 5.3 percent — so it's roughly keeping pace. But it's not the clear win you see in the Northeast or Midwest. Luna: And that's the nuance that gets lost in the national averages. Your raise beating costs depends on where you live and what you're spending on. Lucas: Exactly. The 'stay home and save' mantra was always a simplification. Now it's even more complicated. But for the typical worker, the trend is finally moving in the right direction. Luna: So next time someone tells you to just stay home to save money, you can say: 'Actually, staying home costs more than it used to — but my raise is finally catching up.' Lucas: That's a good way to put it. And it's a reminder that inflation isn't just about what you buy at the store. It's about the cost of just existing in your own home. Luna: Right. The roof over your head — and everything that keeps it standing — is getting more affordable, relative to your income. Lucas: Which is exactly the kind of quiet good news that doesn't make headlines.