Kathmandu: A new labor market report released Thursday by a prominent job-hunting website reveals that more than 40 percent of U.S. workers have experienced a decline in real income over the past year, as wage growth continues to lag behind inflation.

According to the report, average wages rose by 2.9% in the 12 months ending in June, while the consumer price index (CPI) climbed 2.7% in the same period. This narrow gap in growth was not enough to offset the rising cost of living, leaving 43% of workers with reduced purchasing power.

Despite signs of economic recovery since the COVID-19 pandemic, many Americans continue to struggle financially, particularly with rising costs of housing, food, and transportation, the report states.

The wage gains have been unevenly distributed, benefitting mostly those in high-income sectors such as electrical engineering, legal services, and marketing management, which saw annual increases above 6%. In contrast, traditionally low-wage professions like cooking, childcare, and personal care have seen minimal or stagnating wage growth.

This growing income disparity is fueling frustration among low-income workers and may pose risks to household spending, which remains a key driver of the U.S. economy.

While inflation has slightly eased, the report warns that wage inequality and slower income growth for the majority of workers could continue to undermine economic stability. It concludes, “The labor market remains strong, but the benefits have not been shared equally.”