 So when I tell you I’m a little surprised to see almost no movement in wage growth despite the improving employment situation, I hope you’ll give me a listen. To be clear, that’s “a little surprised.” There’s still considerable slack in the job market, and, like I said, workers’ ability to bargain for a bigger slice of the pie has taken a real beating over the years. But given the extent to which the job market has tightened up in recent months, I would expect a bit more wage pressure than I’ve seen (“tightening,” “improving,” “less slack” are all econo-mese for stronger labor demand leading to faster job growth and lower unemployment). So let’s look at the evidence for these claims and think about why the wage dog is not barking. While I offer a number of credible hypotheses, the one I favor is pretty straightforward: Raising pay is simply not part of the business model of... |
