What is the difference between the CPI-U and the CPI-W? Here are the facts‼️
The CPI-U is a more general index and seeks to track retail prices as they affect all urban consumers. It encompasses about 87 percent of the United States’ population.
The CPI-W is a more specialized index and seeks to track retail prices as they affect urban hourly wage earners and clerical workers. It encompasses about 32 percent of the United States’ population and is a subset of the CPI-U group.
The CPI-W places a slightly higher weight on food, apparel, transportation, and other goods and services. It places a slightly lower weight on housing, medical care, and recreation.
The CPI-W is utilized by the Social Security Administration to determine annual rates of increase. See http://www.bls.gov/bls/peoplebox11.htm.
As an aside, the President has proposed for the second year in a row that federal workers receive a 1% pay increase in 2015 (they received no increase in 2011, 2012 or 2013). At the same time Social Security beneficiaries will likely receive a 1.5 to 1.7% hike in benefits. Don’t we have this backwards? Then consider the President also wants a 39% increase in the minimum wage for generally un or low skilled workers on the basis that will help raise the middle class.
So, what we have is:
1⃣ Seniors collecting Social Security receiving a raise greater than all government workers and greater than many, many workers in the private sector.
2⃣ An effort to raise the pay for unskilled workers who are not the middle class at the expense of the middle-class.
I suppose to many people all this makes sense. To me it reflects the politics related to two major voting blocks; the elderly and minorities. It also indicates that despite all the rhetoric, our priorities are not focused on the middle-class because the middle-class pays the cost of all this while for many, incomes are not keeping pace with inflation as low as it may be. It seems the older you are and the more you rely on Social Security income, the better you are treated.