After adjusting for inflation, average U.S. weekly earnings fell by 1.6% in 2009, which was the worst gap between wages and inflation since 1990.

This happened as consumer prices shot up 2.7% during the year. Even core inflation, which excludes food and energy since their prices can bounce around, rose 1.8%.

Overall, this level of inflation is considered tame by economic standards, but it would have actually been far lower, or even negative (deflation) had the Federal Reserve not stepped in to boost liquidity in the financial system and slashed interest rates to near-zero.

While inflation was the lesser evil in Ben Bernanke's economic calculus (whereby he has been trying to stave off 'recession-inducing' deflation), even minor amounts hurt when wage growth is weak. Aware of this, he probably preferred this problem over the damaging effects of a potentially deeper recession.

Nevertheless, it's still shocking to see how inflation-adjusted wages (In constant dollars) have deteriorated over the course of 2009:

Read the Bureau of Labor Statistics release here >