Lower-income wage growth extends its lead

Summary

• Lower-income wage growth reached 4.7% year-over-year in October 2026, compared to 3.4% for higher-income households.
• After-tax wage growth for lower-income households rose from 4.5% to 4.7% year-over-year in October 2026.
• Middle-income households experienced 3.8% year-over-year wage growth in October 2026.
• The improvement in wage growth for lower- and middle-income households is attributed to tax withholding impacts from the One Big Beautiful Bill Act (OBBBA) and labor market broadening.
• Data indicates a rise in job-to-job changes among lower- and middle-income households, accompanied by increased raises during these switches.
• The analysis utilizes aggregated \& anonymized Bank of America consumer deposit account data, credit card spending, \& payroll payment channels.
• Household income terciles are defined by quantitative estimates, with the lowest tercile representing lower income, the middle tercile representing middle income, \& the highest tercile representing higher income.
• The report methodology includes adjustments for population growth differences \& excludes corporate card spending.
• Bank of America Institute prepared the materials for general information purposes, stating they do not constitute investment, legal, accounting, or tax advice.