U.S. average is ~3–4%
Long-run avg ~2.5%
Why nominal vs. real matters
Nominal is the number on your paystub. Real is what that number can actually buy. If your raises just match inflation, your real income is flat — you got a number bump, but no new purchasing power. The gap between nominal and real growth is your true standard-of-living trajectory.
For most U.S. workers the typical raise is ~3–4% and long-run inflation is ~2.5%, so real income grows about 1% per year — slow but compounding. Job changes and promotions are where most lifetime income growth actually happens.
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