This rise since 2021 can be easily seen in the graph in the article I posted also, but the catch is that the increases have been relatively flat where they can been found, and that increase followed a lowering in real wages. Whichever way the data is looked at since 2020, it isn't very reassuring to the general public that wages have essentially stayed flat with inflation, when US productivity growth has been going up. I was actually surprised about the article I referenced in the comment above. The figure I'd read of previously was that real wages had cumulatively increased around 2% since 2020, which the Brookings article seems to reference. 2% real increases in wages is strikingly low considering US productivity growth. It was the figure I was originally looking up.
If you only want to see what you want to see, it's easy to find evidence. On the other hand, look at the commonly posted wages vs productivity graphs (productivity goes up pretty much unbroken, but wages flatline since roughly mid-70s), or compare the 'US is #1!!' GDP per capita numbers against the *median* income numbers. Bit of a difference when you remove Musk, Gates, Bezos et al income from the comparison.
Why would you expect wages to track productivity in an environment where automation increasingly drives productivity gains and the means of automation are provided by employers?
You can take your pick of any point since the pandemic. Wage growth has essentially stayed flat with inflation, whether that be a slight increase or decrease. Much of the nominal wage growth with white collar workers would have been tied to promotions, which inflation has eaten the real gains of. It is no wonder that many people have a poor view of their place in the economy and it is certainly not just "vibes", like it was arrogantly written off as by many.
You realize what you said contradicts the data that has been posted repeatedly in this topic?
Real wage growth surged post-pandemic, especially for lower-income workers.
Most economists have explained the vibes as: People blame inflation for increased prices but credit their own industriousness for wage gains, and are angry they don't get to basically double dip.
"Real" is a misnomer. Interest expenses aren't included in the CPI adjustment for real wage growth. Decreases in used/new vehicle prices wouldn't necessarily offset increases in food prices for someone taking public transit.
For a worker with credit card debt, or one who already struggles to afford public transit, the real wage growth is illusory.
Way to down vote my comment without posting that data you refer to. Nominal wages surged post-pandemic in Q2 2020, but cooled off after then. Someone already replied to my comment with a Brooking institute article which confirms the figures I had previously heard, in that real wages have only increased 2% annualized since 2019.
I didn't downvote anything, and I didn't re-post data because I assumed you already had it as a participant in this discussion.
A 2% annualized increase in real wages is excellent? Compare it to real wage increases elsewhere and you'll see that "only" is not the correct modifier to use.
Meanwhile the real cost of housing is still increasing. It is a bipolar world: the haves and the have nots. If you own land: the economy is great. If you don't own land: you're screwed. Whatever metrics that say wealth inequality is down are lying. It's a polarized world of haves and have nots and people are pissed off.
Wow, talk about a deceptive article. It’s so completely shady the writer surely did this on purpose to fool people like you.
Here’s [1] the wage graph from BLS during that time period, same source as the author. See that incredible, record setting spike at precisely the month in question, never seen before or after? Gee, what do you suppose did that?
The US had just poured 2 trillion into wages for free for pandemic recovery.
This is why you shouldn’t fill your head with nonsense from such crappy sources. Liars will lead you into your own echo chamber. Read proper economic journalists until you learn enough not to believe stuff like that article.
>Here’s [1] the wage graph from BLS during that time period, same source as the author. See that incredible, record setting spike at precisely the month in question, never seen before or after? Gee, what do you suppose did that?
Given how arrogant you are, it is ironic that you're the one that interpreted the graph incorrectly. They didn't reference the spike "precisely the month in question". The figure they referenced at the start of the graph was Q4 2020. The spike in the FRED graph was in Q2. Perhaps you should think before you type next time, so you don't paint yourself the fool you claim others to be.
If they had referenced the spike in Q2, the decrease would have been >5%. If you want to start casting stones, you better be sure you're right.
Read the graph. The nov, q4 value in the graph is 376, is part of the Covid spike, and no other points in all of history that are not part of that spike are as high as the q4 value.
Zoom in if you cannot read it. A spike is not a single month. It’s a spike with an upside and downside. You think the effects of a free few trillion poured into people’s hands only affected an infinitesimal width spike?
So no, I did not interpret this graph incorrectly, and the poster chose a point from an artificial spike to mislead.
Perhaps if you aggregated inflation, which is a lagging variable, it will turn out he chose precisely the quarter that made his point better than any other quarter, in which case he really went the extra mile to provide misleading claims.
If you’re going to attempt to discredit a correct argument, at least evaluate it correctly.
>See that incredible, record setting spike at precisely the month in question
>If you’re going to attempt to discredit a correct argument, at least evaluate it correctly.
Sure, it is part of the downward slope of a multi-quarter spike, but that is not what you said. What you are doing now is attempting to re-frame prior inaccurate wording to claim that you were accurate all along. That first quote is what you said in your first comment. Q4 was the second quarter of decline following the spike. You said the spike was at "precisely the month in question", which it certainly was not. Q4 2020 was half a year after the peak of the spike. That hardly qualifies for even a very generous interpretation of the word "precise".
>Perhaps if you aggregated inflation, which is a lagging variable, it will turn out he chose precisely the quarter that made his point better than any other quarter, in which case he really went the extra mile to provide misleading claims.
Not only is this reaching, but you've just demonstrated that you don't understand what the graph you said was misleading refers to. Real wages does account for aggregate inflation.
> Sure, it is part of the downward slope of a multi-quarter spike, but that is not what you said.
That you confuse the word spike to mean only the tip is odd. The downward part of a spike is part of a spike, and the cause and use of this anomaly is not in question. Choosing an outlier high point as a basis to make general claims will always lead to misrepresentations.
Is a railroad spike only the tip? Is a volleyball spike only the highest (or lowest) part? Is a signal spike the zero width instant of maximum value?
I cannot think of a use of the word spike that means the tip and not the entirety. Looking at online dictionaries I cannot find the use you claim. I do find many definitions and examples including both the upside and downside. So I’m quite correct claiming the author choose the spike, and obtains the expected poorly reasoned claims as a result.
> Not only is this reaching, but you've just demonstrated that you don't understand what the graph you said was misleading refers to. Real wages does account for aggregate inflation.
If you dig through my posts, you’ll see I taught mathematical grad econ at a top 50 university. What you misread, then try to use Econ 101, is simply incorrect. As your other comprehension showed, you ignored the precise word “lagging” that I wrote, because real wages at a given date do not include inflation from the future.
Please read and think. You’re so bent on trying to argue you don’t read what I wrote, and instead argue your misreadings.
Let me simplify: it’s well known inflation as a result of cash transfer causes lagging inflation (pretty much all schools of economics agree on this, from Keynesian, neo, Austrians, Friedman, all the flavors of monetarists, pretty much everyone). Hence the precise Econ term lagging variable. Other ones are that wage growth usually lags inflation. This is all basic economics. It’s why I precisely put the word “lagging” in that sentence. It means future inflation above. Most definitely not a part of that spike.
Here, there was an economic shock causing the govt to expand the money supply without expanding production. This money, handed out in large part as cash, adds to real wages at that moment. This will lead to inflation, but that is not part of those real wages. Later, inflation will devalue money, making real wages decrease. Then later again, historically wages gain back purchasing power as people get salary increases. This is done (alert, another term so read carefully) because wages are called a “sticky variable” in Econ. Wages are easy to ratchet up but not down, due to psychology of humans. Wages are hard to move freely like many other variables. Ideally from a math model side, if wages were not sticky, then as the shock passed, prices could fall, and all values return to baseline. But people don’t see that, so it’s easier to ratchet up wages, which ratchets up prices, locking in inflation.
So to maximize the type of nonsense this post spreads, you can always fiddle with the chunks in these troughs to make things look much worse than they are.
So next time please learn the difference between aggregate inflation (current) and the phrase lagging variable. And don’t put claims into my writing so you can argue straw men.
I’m done. You’re trying to correct something that is simply your odd usage of a word.
https://www.statista.com/chart/32428/inflation-and-wage-grow...