Latest / Wages and Prices with Fexingo: Cost of Living, Pay Raises, and Workers' Purchasing Power / Why Your Raise Is Finally Beating Gym Membership Costs
Transcript
- Lucas: If you've walked into a gym lately and winced at the monthly rate, you're not alone. But here's the thing — your raise might finally be pulling ahead of that bill. Luna: That would be a shift. For years, gym memberships seemed to climb faster than almost any other recurring expense. Lucas: Right. And it makes sense — fitness became a premium category. Boutique studios charging thirty dollars a class, big-box chains pushing their monthly dues up three to five percent every year. Meanwhile, wages were lagging behind overall inflation. But if we look at the most recent data, something has flipped. Luna: What's the headline number? Lucas: Average hourly earnings for private workers hit $37.60 in June, up from $37.51 in May. That's a modest month-over-month gain, but year-over-year it's roughly a 4.2 percent increase. Compare that to gym membership inflation, which according to the Bureau of Labor Statistics' consumer price index has been running around 2.8 percent annually. Luna: So wage growth is outpacing gym cost growth by more than a percentage point. That's not huge, but it's a real reversal from, say, 2022 or 2023. Lucas: Exactly. In 2022, gym memberships were up over 5 percent year-over-year while wages were struggling to keep pace with overall inflation of 8 or 9 percent. The fitness category was eating into people's budgets. Now, wage growth is solidly above the category's inflation rate. Luna: And this is happening even as the broader jobs market shows some softness. The June payrolls report came in at just 57,000 jobs added, and the unemployment rate ticked up to 4.2 percent. Lucas: Right. That's a cooling labor market, but wages are still rising — partly because the composition of jobs is shifting toward higher-paying sectors, and partly because employers are still competing for workers in certain roles. So even with fewer new hires, the people who are working are earning more per hour. Luna: And that feeds into purchasing power for things like gym memberships, which are discretionary. If your raise is beating the price hike, you're more likely to keep that membership active. Lucas: Let's put some concrete numbers on it. The average monthly gym membership in the U.S. is about $58, according to the International Health, Racquet & Sportsclub Association. At the current average hourly wage of $37.60, that's about 1.54 hours of work to cover that membership. Two years ago, when average hourly earnings were around $35.00 and gym memberships were about $54, it took about 1.54 hours too. So it's roughly flat. But if we go back to 2021, when wages were $32.00 and memberships were $50, that was 1.56 hours. So the trend is slowly improving. Luna: It's not a dramatic improvement, but it's moving in the right direction. And for higher-end memberships, the gap might be widening more. Lucas: That's a good point. Premium chains like Equinox or Life Time Fitness have been raising prices aggressively — some clubs now charge over $200 a month. But even there, wage growth among higher earners has been strong. The employment cost index for wages in the first quarter of 2026 was up about 4.5 percent year-over-year, so white-collar workers are seeing solid gains too. Luna: Meanwhile, the discount segment — Planet Fitness, Blink, Crunch — has been more cautious on price increases, probably to retain members who are more price-sensitive. So the overall category inflation is moderated by that mix. Lucas: Exactly. And that mix is what keeps the CPI for gym memberships relatively tame. But individually, if you're a member of a boutique studio that charges $150 a month, your experience might be different. The key is that, on average, wages are winning. Luna: I want to zoom out a bit. This is a small category — gym memberships are maybe 1 percent of the average household's spending. But it's a canary in the coal mine for services inflation more broadly. If wage growth can consistently beat price increases in services, that's a good sign for consumer health. Lucas: Absolutely. And it's not just gyms. We've seen similar dynamics in categories like streaming services, cellphone plans, even car insurance. The pattern is that goods inflation has cooled significantly, but services inflation has been stickier. Now, with wage growth continuing, the ratio is improving. Luna: One thing that could disrupt this is if the labor market weakens further. The June report showed a drop in labor force participation to its lowest level in 50 years outside the pandemic. That could eventually put downward pressure on wages if demand for labor softens. Lucas: That's the risk. But for now, the data supports the idea that the typical worker can afford their gym membership with a slightly smaller slice of their paycheck than they could a year ago. It's not a huge victory, but it's a real one. Luna: And it's worth noting that this is happening even as overall inflation remains above the Fed's target. Core PCE is at 2.6 percent, and the ten-year breakeven inflation rate is around 2.2 percent. So it's not like the battle is over. Lucas: No, but in this one category, the consumer is gaining ground. And if you're someone who's been considering whether to keep that gym membership, the math is a little more favorable than it was. Luna: Alright, let's take a quick step back. If walking through the economy with us has made something click — whether it's this gym membership dynamic or something else — we should mention that a handful of listeners already chip in monthly through buy me a coffee dot com slash fexingo. That's literally what keeps these episodes coming without any ads. Lucas: Yeah, it's a small group, but it makes a big difference. We keep the show ad-free because of that support. So if you find value in these deep dives, that's the easiest way to help keep it going. Luna: And we're back to the data. One more angle I want to touch on: the regional variation. Gym membership costs vary hugely by metro area. In San Francisco, the average monthly fee is over $80, while in Houston it's closer to $40. How do those compare to local wages? Lucas: Great question. Let's look at San Francisco. Average hourly earnings in the Bay Area are around $45, so 1.78 hours for that $80 membership. In Houston, average wages are about $32, so 1.25 hours for a $40 membership. So actually, in terms of hours worked, Houston is more affordable. That's interesting because it flips the intuition that big cities are always more expensive relative to income for this particular expense. Luna: That makes sense — gyms in high-cost cities have higher rents and labor costs, which they pass on to members. But wages don't always scale proportionally. So the affordability gap isn't as wide as you might think. Lucas: Right. And this is exactly the kind of granular data that the national averages can obscure. For a listener in San Francisco, the story might be different than for someone in Houston. But the national trend is still positive. Luna: So what's the takeaway for someone listening right now? Should they feel better about their gym bill? Lucas: If your raise has been at least 3 percent over the past year, you're likely keeping pace or gaining ground on this particular expense. That's not true for every category — rent and healthcare are still running hot — but for gym memberships, the tide has turned. It's a small win, but a win nonetheless. Luna: And it's a reminder that inflation isn't uniform. Some things get cheaper relative to wages even when the headline number is still elevated. Lucas: Exactly. So next time you swipe your membership card, you can think of it as one of the few bills where your paycheck is finally winning.