Originally Posted by
kwri10s
Not sure you are not doing your math correctly. The $12k increase is the increased cost for a family with the median income of $71k. That's where they get the CPI rate. If you make more, you probably also spend more, thus your inflation expense (12K in this average example) would also be higher. If your Market Basket of Goods and Services spending is 300k over three years; then you spent an extra 51k than you would have prior to Nov 2020. The CPI gives you an "idea" at best how inflation is effecting the population. It varies by region/state/local, etc. Some areas will be higher, some lower. I'd guess the company negotiator will try to use the CPI for Memphis and hopefully we use the CPI for ALPA HQ/NYC/SFO, etc.
I think the main point was: it is not a pay raise, but an inflation adjustment.
That's OK if you aren't sure. I am. The headline +17% increase is specifically for that hypothetical average consumer. Everyone is going to have their own inflation rate. My housing cost went down in 2020 because I refinanced into a 2.25% mortgage. Housing accounts for typically 40% (weighted) of the CPI. So my cost (and the corresponding portion of my CPI) decreased. My transportation cost increased because I bought a new car.
The point is....that CPI number isn't for you. If you make twice as much as average, it doesn't mean your basket of goods cost twice as much. If you make 6-7 times the average, you aren't paying $18-21 for a gallon of gas, you aren't paying $60 for a movie ticket, and you aren't paying $20 for a bottle of aspirin at Costco. CPI is a tool that doesn't work well outside of +/- 1 standard deviation.
Does the CEO making $100,000,000 a year need a $17 million raise so he can keep up with inflation?