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Ontario inflation goes up and wages fall behind


Ontario inflation is beginning to heat up.  As recently as May, the year over year increase in the Consumer Price Index was a mere 0.49%.

Today's data for July indicates that Ontario prices have gone up 1.65% since last year.  While this is partly due to a dip in prices in  June and July of 2012, prices also went up significantly in June and July of 2013.  

Since May 2013, the CPI has increased from 123.0 to 123.4.  On an annualized basis, that would imply an annual inflation increase of 1.91% by May 2014.

Gasoline prices led the way with an annual increase of 5.5% in Ontario (6.1% across Canada).

Hourly wages and inflation
Average hourly wages in Ontario for July were up 1.5%  compared to a year earlier.  In other words, wages are falling slightly behind inflation.  

This too is a bit of a change since May. Although hourly average wages were up a bit less in May -- 1.15% over the year -- that hourly wage increase was still significantly ahead of the 0.49% annual inflation reported in May.  

Workers have gone from making a real hourly wage gain to falling a bit behind. 

Union wages see biggest increase
Average union wages were up 3.6% in Ontario for the year ended in July, way above inflation.  Non-union hourly wages saw an increase of only 0.5%

Across Canada, hourly wages were still ahead of inflation in July (1.8% increase for wages versus 1.3% for inflation).  Union wages were up 3% and non-union wages 1.4%.

Photo: Stargazer95050


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