WASHINGTON — Working-class Americans are seeing their paychecks stretch further even as inflation remains elevated amid the Iran war, with wage growth for many lower- and middle-income workers outpacing price increases over the past year, according to newly released data.
During the second quarter of 2026, which ended in June, workers earning at or below the national median income posted sizable wage gains that exceeded the 3.5% inflation rate, the Wall Street Journal reported.
Employees at or below the median income level saw weekly wages rise 4.6% from a year earlier. Pay increased even faster for those at or below the 25th percentile — the lowest-earning quarter of workers — with weekly earnings climbing 5.5%, according to Bureau of Labor Statistics figures.
The White House pointed to the numbers as proof that President Trump’s economic approach is delivering results.
“President Trump pledged to deliver economic relief for the American people after four years of Joe Biden’s malfeasance and incompetence. The proven Trump economic agenda of working-class tax cuts, rapid deregulation, and energy abundance is delivering,” White House spokesman Kush Desai said.
A second White House official also highlighted last month’s Consumer Price Index report, noting that beyond wage growth, it showed energy costs falling before the war resumed and included other encouraging signs. Among them was a 2.5% annual decline in prescription drug prices, following Trump’s pressure campaign on pharmaceutical companies to bring prices closer in line with those in other major countries.
The wage data carry major economic and political implications. Economists told the Journal the gains may help explain resilient consumer spending, which has supported the broader economy even as energy prices surged following Iran’s months-long closure of the Strait of Hormuz.
The figures also suggest inflation may be inflicting less financial strain on lower-income Americans than usual, despite those households typically being more vulnerable because they have less discretionary income.
Trump’s tax cuts on overtime, tips and Social Security benefits generally are claimed when filing taxes — meaning the beginning of the year.
Democrats are leading Republicans in polls ahead of the November midterm election, which will dictate control of Congress during Trump’s final two years in office — with the race testing the resilience of Trump’s 2024 coalition, which included big gains among Hispanics and the working class.
Some of Trump’s best-known policies have unclear contributions to lower-end earnings, including his mass-deportation campaign targeting illegal immigrants, who can compete with citizens for jobs that do not require higher education.
Trump has aggressively used tariffs to boost US exports and domestic manufacturing, but neither have yet notched significant gains in federal data.
Although real income gains are reported for the bottom half of earners, the picture is less rosy slightly higher up the ladder.
Middle-to-upper-middle class wages haven’t kept up with inflation — with the benchmark for the 75th percentile improving just 1.5% over the past year.
Trump has catered his political message to this demographic by frequently mentioning the roaring stock market, driven by the artificial intelligence boom, which has lifted 401(k) retirement accounts.
Top earners, whose status is more difficult to assess from the BLS quarterly data, are still doing well.
Bank of America data cited by the Journal show that annual wage gains are still strongest among the upper third of workers who use the bank. The lowest third is effectively tied — both beating inflation — and is trailed by the middle third.
