Hourly Earnings and Real Hourly Earnings
- Wages appears to be spiraling out of control (top 2 lines blue and red), but appearances deceive.
- Real (CPI-adjusted) wages have gone nowhere for decades.
- Production and nonsupervisory workers made $9.38 per hour in CPI-adjusted dollars in 1973. Today they make $9.42 per hour.
Nominal Wages Year-Over-Year Percent Change
- Production and nonsupervisory workers are making 6.35 percent more per hour than they did a year ago.
- All workers are making 5.11 percent more per hour than they did a year ago.
Things don’t look so good when you factor in inflation running a hot 9.1 percent more than a year ago.
Real Wages Year-Over-Year Percent Change
Workers Currently Losing to Inflation
For 15 consecutive months dating to April 2021, workers have had big wage hikes but those hikes have not kept pace with inflation.
Q: What happened in April 2021?
A: The third and largest by far free-money free money stimulus package by president Biden.
People immediately when on a huge goods buying spree that neither manufacturers nor supply chains were prepared for.
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The trend of no wage gains go back much further.
Production and supervisory workers make only four cents more per hour in real terms than February 1973!
Free Money Stimulus Checks and the CPI
For discussion of the CPI, please see Consumer Price Index Jumps Another 1.3 Percent, Much More Than Than Expected
Recession is Here and Housing Will Lead
For discussion of the recession and the impact durable goods and housing play, please see A Big Housing Bust is the Key to Understanding This Recession
The Fed aims to cool inflation and they will. The result will be like trying to slice a tomato with a hammer.
This post originated at MishTalk.Com.
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Image and article originally from mishtalk.com. Read the original article here.