Job gains have been strong this year, but wages continue to grow at a painfully…
Job gains have been strong this year, but wages continue to grow at a painfully slow rate.
Real average hourly earnings for all employees increased 0.2 percent from May to June, seasonally adjusted, the U.S. Bureau of Labor Statistics reports.
This result stems from a 0.2-percent increase in average hourly earnings combined with no change in the Consumer Price Index for All Urban Consumers (CPI-U). In other words, “real wages” are wage gains with inflation factored in, and there hasn’t been much in the way of official inflation.
Real average weekly earnings increased 0.5 percent over the month due to the increase in real average hourly earnings combined with a 0.3-percent increase in the average workweek.
Real average hourly earnings increased 0.8 percent, seasonally adjusted, from June 2016 to June 2017.
The increase in real average hourly earnings combined with a 0.3-percent increase in the average workweek resulted in a 1.1-percent increase in real average weekly earnings over this period.
This is frustrating. What we hope to see, with the strong job gains, is a tightening labor market leading to rising wages.
In fact, as Pew Research recently pointed out, real wages were increasing by around 4% year-over-year before the Great Recession. Despite all the years of recovery since then, we still haven’t gotten back to those gains.