The reason the US Federal Reserve is willing to raise interest rates as I just told you, despite fears of a recession, is because the extent of inflation is so large.
Inflation has risen to this extent, but wages have not risen that much, suggesting that the real income of the middle class has declined.
There is a strong demand for a raise right now, but the government is asking for restraint for fear of rising prices.
This is reporter Jeong Hye-jin.
is a large supermarket in Seoul.
Let's take a look at the daily necessities that we often buy in our house of four in a city where a married couple earning a salary, a three-year-old child, and a grandmother in their 60s live together.
For the same product, the price of processed foods such as wheat flour 43%, cooking oil 10%, and ramen 9% increased significantly compared to a year ago, and fresh foods such as green onions 62%, potatoes 50%, and onions 34% rose significantly.
I buy 12 kinds of food, last year it was 74,800 won, but this year it was 84,000 won, which means that the cost of living has risen by more than 12% in one year.
Wages have not risen as much as prices have risen.
In the first quarter of this year, the income of urban worker households on their pay stubs increased 6.4% from a year earlier.
However, the real income, after subtracting the inflation rate from the increase in wages, was counted as declining in the middle class.
Excluding the top 20% of income earners and the bottom 20%, whose government support has increased, the real income of middle-class households has decreased by 1-3% compared to a year ago.
[Kim Sang-bong / Professor of Economics, Hansung University: When the real income of the middle class decreases, the ability to consume will decrease.
Consumption will decrease and the growth rate will fall again.]
As inflation soared to 6% since April, the real income of the middle class in the second quarter is expected to decrease further.
In addition, there is also high inflation that expects prices to rise further, leading to demand for a wage increase and increasing inflationary pressure.Keywords: