Over the last 20 years, the Consumer Price Index for all items has increased by 63.5% (see red line in chart above), while the price of clothing measured by the CPI for apparel has fallen by 3.3% (blue line), meaning that the real inflation-adjusted cost of apparel for Americans has fallen by about 41% (1 – (96.7 / 163.5)), see chart above (and thanks to “Old Pete” for the new, revised formula). In other words, clothing that would have cost $100 in 1993 would today cost only $59.10 in constant dollars.
Measured in average hourly earnings (“time cost”), clothing prices have fallen even more dramatically over the last two decades. Since January 1993, the Average Earnings of Private Production and Nonsupervisory Employees has increased by 84.6% from $10.94 per hour to $20.20 per hour. Therefore, for the average worker to purchase $100 worth of clothing in 1993 would have required 9.14 hours of work ($100 / $10.94 per hour); whereas the average worker today would only have to work 4.8 hours to purchase the same clothing today ($97 / $20.20 per hour), for a 47.5% reduction in the “time cost” of purchasing clothing.
Bottom Line: This is another example of the fact that even if median household money income (which doesn’t account for total compensation, i.e. non-monetary fringe benefits) is stagnant over time, that doesn’t necessarily mean that the average household’s standard of living is stagnant or declining. In the case of buying clothing for a typical American household even with a constant income over time, the standard of living for most households has actually increased significantly over the last 20 years, when measured in what is ultimately most important: household consumption and the affordability of life’s basics.