As the world slowly recovers from the coronavirus pandemic, one short-term event to worry about is inflation. Inflation is a decline of purchasing power that occurs when the cost of goods increase over time. Your purchasing ability has gone down on Guam with stagnant wages, heavy job losses in the private sector due to a lack of tourism, and an increase cost of goods. Some analysts think that the high inflation is temporary, while others think it will last a lot longer.

What can be done about your loss of purchasing power?

The first step is to see where Guam is in comparison to the rest of the United States. Have you ever wondered where your pay ranks compared to Guam’s average? How about the national average? How about by state?

As discouraging as it may appear, this guides the discussion of where we should be.  Do not be fooled into thinking that Guam’s wages are low because our cost of living is low. In fact, our cost of living is a lot higher here than in the states. The consumer price index (CPI) for the United States accelerated the quickest in the last 30 years, excluding food and energy.  The real average hourly earnings fell yet again.  The only reason wages have remained flat is that the Guam Legislature stacked the deck against the unions from negotiating wages for most agencies.  The Guam Legislature is the reason government workers can double their salaries by working in the states.

Let the Guam Legislature know that the last wage increase in 2014 was actually a wage compression.  A wage compression is increasing the bottom salaries while leaving the top relatively untouched. This is great for new employees but the gains are eroded quickly in comparison to our national counterparts. Despite the downturn in the economy, planning now would accelerate recovery efforts once tourism improves.

Pay Comparison

If you would like to see a comparison between an occupation on Guam and the United States, drop a comment below.