Latest / Wages and Prices with Fexingo: Cost of Living, Pay Raises, and Workers' Purchasing Power / Why Your Raise Is Finally Beating the Cost of a Wedding
Transcript
- Lucas: So you're engaged, you're excited, and then you start pricing venues. And you think, wait, is this number real? We're going to talk about whether your raise is finally beating the cost of a wedding. Luna: I feel personally attacked. But also, the data here is genuinely interesting. Let's dig in. Lucas: Before we get to the gowns and the guest lists, a quick note. If walking through the economy with us has made something click, and you've got a dollar to spare, you can support the show at buy me a coffee dot com slash fexingo. It keeps us ad-free and independent. Luna: Yeah, it's the smallest ask. And we genuinely appreciate it. Lucas: Now, let's talk numbers. The average wedding in the U.S. now costs over thirty thousand dollars. That's a down payment on a house in some markets. But the key question is: how fast has that cost been rising compared to your paycheck? Luna: Right. And we've been doing this whole series on raises beating specific costs. So what does the data say for weddings? Lucas: So, wedding costs have historically risen faster than overall inflation. Think about it: the average wedding in 1980 was around ten thousand dollars in today's money. Now it's over thirty. That's a compound annual growth rate of about four percent, while overall CPI has averaged around three percent. Luna: So weddings have been outpacing general inflation for decades. But what about the last couple of years, when wages have actually been growing? Lucas: That's the interesting part. Since 2023, average hourly earnings have been climbing about four percent a year, and we've seen services inflation start to cool. In June, the consumer price index actually fell slightly from the previous month, and core CPI is down year-over-year. So the gap is closing. Luna: But is that true for weddings specifically? I mean, wedding vendors might be a different beast. Lucas: Absolutely. Wedding costs are heavily tied to services like catering, photography, and venues. And those are labor-intensive. But here's the thing: the employment cost index for wages is up, and that's actually feeding into what vendors charge. So it's a little circular. Luna: So if wages are going up, vendors charge more, but if you're the one getting the raise, you can afford it. Is that the takeaway? Lucas: Basically. Let's look at a concrete example. Say you're a couple making the median household income. In 2020, the average wedding cost about five months of your combined take-home pay. Now, with wages up about twenty percent since then, it's closer to four and a half months. So it's getting more affordable, relatively speaking. Luna: That's a real shift. But I've seen studies that say the 'average' wedding cost is skewed by a few big-budget affairs. What do most couples actually spend? Lucas: You're right. The median is lower, probably around eighteen thousand. But even that number has been rising, just not as fast as the average. And the components matter: venue and catering are the big ones, and those have seen some of the highest inflation. Luna: So what's driving those costs? Is it just labor, or is there something else going on? Lucas: There's a bit of the 'wedding industrial complex' effect. Once you say the word 'wedding,' prices can jump. A venue that costs five hundred dollars for a corporate event might cost two thousand for a wedding. That's not all inflation; that's market segmentation. Luna: Right, I've heard that. But if wages are finally catching up, does that mean couples are choosing bigger weddings again? Lucas: Actually, the data suggests the opposite. The average guest count has been shrinking, and more couples are doing non-traditional things like elopements or weekday weddings. That's a response to cost, but also to changing priorities. Luna: So maybe the real story is that couples are being smarter with their money, and the raise gives them a bit more breathing room. Lucas: Exactly. And that's a good thing. Let's put it in the context of the broader economy. Real wages have been growing for a couple of years now, and that's a big deal. The average hourly earnings are up to thirty-seven dollars and sixty cents, and the median weekly earnings are over twelve hundred dollars. Luna: And that's against a backdrop of cooling inflation. The ten-year breakeven rate is at two point two percent, which suggests the market expects inflation to stay moderate. Lucas: Right. So if you're planning a wedding for next year, the math is looking better than it did a few years ago. But there's a catch: the wedding industry doesn't always adjust prices quickly. You might still see quotes that assume higher inflation. Luna: So the advice is to negotiate, right? Don't just accept the first quote. Lucas: Definitely. And also consider timing. A Saturday in June is going to cost more than a Friday in February. That's not new, but it's more relevant when you're trying to make your budget work. Luna: I think the big takeaway is that weddings are still expensive, but they're not becoming more expensive relative to your paycheck. And that's a shift from the last two decades. Lucas: Yeah, and it's worth remembering that a wedding is one day. The marriage is the long-term investment. But if you're in the middle of planning, it's nice to know the economics are on your side a little more than they used to be. Luna: And if you're not planning a wedding, this is still a good example of how wage growth can outpace a specific sector. It's not uniform. Lucas: That's the broader point. Wages are beating some costs and not others. Weddings are one where the gap is finally closing. Next time, we'll look at another one. Luna: Thanks for joining us. Until next time.