Friday, January 9, 2015
Wages are heading in the wrong direction
- by New Deal democrat
Earlier today I red-flagged wages as an issue in the December jobs report, which was otherwise good.
Here's why. Below is the graph of nominal YoY wage growth. In other words, without factoring in inflation:
Even before this morning's report, the YoY rate of growth in wages had stalled in 2014, and appeared to be declining even in October and November. While I suspect there will be a revision to the wage number from this morning, the fact is that the growth rate in wages is decelerating. This is not what I expected to see, and obviously is not good.
I don't have a ready explanation. I'll think about it.