Cost of Living Adjustment

Definition

COLA. An annual adjustment in wages to offset a change (usually a loss) in purchasing power, as measured by the Consumer Price Index. The Consumer Price Index is used rather than the Producer Price Index because the purpose is to offset inflation as experienced by the consumer, not the producer.

Use this term in a sentence

My cost of living adjustment raise was just enough for me to be able to keep up with inflation on my property taxes.

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I am hoping we will get another cost of living adjustment through my job, since food prices have gone up so much recently.

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I only got a Cost Of Living Adjustment in my pay this year because the company did not make much money. I did not get a raise, in the classical sense.

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