Divide the price of gasoline by average hourly earnings of private sector production and nonsupervisory workers:
Figure 1: Number of minutes of labor per gallon of regular gasoline – all private NFP (blue), and leisure and hospitality workers (tan). NBER defined peak-to-trough recession dates shaded gray. Source: EIA and BLS via FRED, NBER, and author’s calculations.
The number of minutes needed to buy a single gallon was lower in January than in January 2020, just before the pandemic.
Since the distribution of wages is skewed, it makes sense to see how the cost of gasoline has evolved using the wages of the lower paid. This is proxied by the earnings/hour of those in the leisure and hospitality services. 9.6 minutes in January is less than the value recorded in February 2021.
