If your employer gives you a raise that is less than the inflation rate, it means that

The employee is losing purchasing power.

Explanation:

Inflation can be defined as a sustained increase in the general price level of goods and services in an economy over a particular period of time.

The inflation rate has a direct bearing on your income because if your history of salary increases at your company is less than the inflation rate, year after year you are losing purchasing power.

d, conspicuous consumption is when you try to increase your wealth or social status (and in the case he's trying to create the perception of wealth considering he can't really afford it)