{"id":11580,"date":"2023-08-31T13:04:37","date_gmt":"2023-08-31T13:04:37","guid":{"rendered":"http:\/\/lonecandle.com\/?p=11580"},"modified":"2023-08-31T13:04:37","modified_gmt":"2023-08-31T13:04:37","slug":"when-it-comes-to-the-economy-everythings-great-and-no-ones-happy","status":"publish","type":"post","link":"https:\/\/lonecandle.com\/?p=11580","title":{"rendered":"When it comes to the economy, everything\u2019s great and no one\u2019s happy"},"content":{"rendered":"\n

\n\n“wages aren\u2019t as fluid<\/em> as, say, gas prices, which seem to jump up or down in an instant. There are reasons for this. Gas prices are easily observed and easily changed, and people will happily switch stations to save a few cents per gallon. Labor markets aren\u2019t like this at all. Switching jobs takes time and effort, and many workers are reluctant to give up the devil they know for the devil they don\u2019t. Employers capitalize on this situation by adjusting wages slowly, if at all.”
…
“High inflation, combined with slow wage adjustment, drives purchasing power down. And this is true not just for the US. Canada\u2019s post-Covid pay<\/a> has followed the same trajectory as ours, and it is not alone<\/a>.”   
…
“To climb out of this hole, real wages will have to start growing again. The good news is that they already have. Annual real wage changes turned positive in February; month-on-month changes turned positive late last year. In this respect, we are doing well. Most European economies still haven\u2019t seen real wage growth<\/a>.<\/p>\n\n\n\n

Furthermore, this hole is shallower than it may seem. Since late 2020, real wage reductions have cost households a little less than $1 trillion. That is a lot, without a doubt, but it is less than half of what households received in Covid-related transfers \u2014 stimulus payments, expanded unemployment insurance, child care<\/a> credits, and the like \u2014 which amounted to $2 trillion<\/a>. That puts them well ahead of where they were in March 2020<\/a>, which is why people report that their own finances are doing just fine<\/a>, even while they trash the state of the economy.”<\/p>\n\n\n\n

…<\/p>\n\n\n\n

“What we need to free ourselves from is the preconception that low unemployment alone makes a good labor market. Where we actually are is simple to understand. Dollar wages adjust slowly to price increases. Inflation has raised prices a lot, reducing purchasing power. As a result, the public is not happy about the economy.”<\/p>\n\n\n\n

https:\/\/www.vox.com\/money\/2023\/8\/10\/23824742\/real-wages-economy-inflation-no-money<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

“wages aren\u2019t as fluid as, say, gas prices, which seem to jump up or down in an instant. There are reasons for this. Gas prices are easily observed and easily changed, and people will happily switch stations to save a few cents per gallon. Labor markets aren\u2019t like this at all. Switching jobs takes time and effort, and many workers are reluctant to give up the devil they know for the devil they don\u2019t. Employers capitalize on this situation by adjusting wages slowly, if at all.”<\/p>\n

…<\/p>\n

“High inflation, combined with slow wage adjustment, drives purchasing power down. And this is true not just for the US. Canada\u2019s post-Covid pay has followed the same trajectory as ours, and it is not alone.” <\/p>\n

…<\/p>\n

“To climb out of this hole, real wages will have to start growing again. The good news is that they already have. Annual real wage changes turned positive in February; month-on-month changes turned positive late last year. In this respect, we are doing well. Most European economies still haven\u2019t seen real wage growth.
\nFurthermore, this hole is shallower than it may seem. Since late 2020, real wage reductions have cost households a little less than $1 trillion. That is a lot, without a doubt, but it is less than half of what households received in Covid-related transfers \u2014 stimulus payments, expanded unemployment insurance, child care credits, and the like \u2014 which amounted to $2 trillion. That puts them well ahead of where they were in March 2020, which is why people report that their own finances are doing just fine, even while they trash the state of the economy.”<\/p>\n

…<\/p>\n

“What we need to free ourselves from is the preconception that low unemployment alone makes a good labor market. Where we actually are is simple to understand. Dollar wages adjust slowly to price increases. Inflation has raised prices a lot, reducing purchasing power. As a result, the public is not happy about the economy.”<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[13],"tags":[217,165,1316,1139,574],"class_list":["post-11580","post","type-post","status-publish","format-standard","hentry","category-article-share","tag-economics","tag-economy","tag-inflation","tag-wages","tag-workers"],"_links":{"self":[{"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/posts\/11580","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/lonecandle.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=11580"}],"version-history":[{"count":1,"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/posts\/11580\/revisions"}],"predecessor-version":[{"id":11581,"href":"https:\/\/lonecandle.com\/index.php?rest_route=\/wp\/v2\/posts\/11580\/revisions\/11581"}],"wp:attachment":[{"href":"https:\/\/lonecandle.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=11580"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lonecandle.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=11580"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lonecandle.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=11580"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}