Decidedly up in the latter, even up relative to 2022M02 in the former.
Category Archives: labor market
The “Unexpected Compression”
of real wages. Or as the FT article summarizes it, “America’s lowest-earning workers are enjoying higher wage growth than top earners, after taking into account the effects of the recent bout of high inflation.” From Autor, Dube and McGraw (2023).
Remembering the 2022H1 Labor Market Collapse Hypothesis
Mr. Steven Kopits asserted that the Philadelphia Fed’s early preliminary benchmark supported a recession in 2022H1, to wit:
You, Menzie, held the Est Survey was more likely right. You wrote: So: (1) I put more weight on the establishment series, and (2) the gap between the two series is more likely due to increasing, and biased, measurement error in the household series, rather than, for instance, primarily increases in multiple-job holders. https://econbrowser.com/archives/2022/12/the-household-establishment-job-creation-conundrum
Dead wrong, as it turned. And predictably so.
You were wrong because you did not consider the statistics more holistically. That’s the learning point for your students. Cross check your indicators if you have dials which are telling you different things. If jobs are increasingly rapidly, then GDP should also be up. If jobs are increasing rapidly, then mobility and gasoline consumption should also be up, because so many people need to drive to work in this country. Finally, if productivity is imploding when jobs are up, you really need to take a pause and put together some sort of narrative as to why that might be happening. It suggests something anomalous in the data which requires closer inspection.
Had you done that, Menzie, you might have concluded as did the Philly Fed…
What remains of that hypothesis? Well, on March 16th, the Philly Fed released this update.
Guest Contribution: “Gauging Recessions with the Jobs-Workers Gap – April 2023”
Today, we are fortunate to present a guest contribution written by Paweł Skrzypczyński, economist at the National Bank of Poland. The views expressed herein are those of the author and should not be attributed to the National Bank of Poland.
The Employment Situation Release: Benchmark Revisions and Seasonality
The Employment Situation release for January 2023 incorporated annual benchmark revisions to establishment survey series, and reported population controls for the household survey series. NFP at 517 thousand exceeded the Bloomberg consensus of 115 thousand.
Guest Contribution: “Gauging Recessions with the Jobs-Workers Gap – January 2023”
Today, we are fortunate to present a guest contribution written by Paweł Skrzypczyński, economist at the National Bank of Poland. The views expressed herein are those of the author and should not be attributed to the National Bank of Poland.
We present an update of the jobs-workers gap discussed in previous posts: [1], [2], [3].
“Inflation begins to slow, signaling lower costs for consumers”
My colleague Kenneth West did a long interview on inflation, interest rates, and recession, on Wisconsin Public Radio’s Central Time on Monday [audio]
Guest Contribution: “Gauging Recessions with the Jobs-Workers Gap – November 2022”
Today, we are fortunate to present a guest contribution written by Paweł Skrzypczyński, economist at the National Bank of Poland. The views expressed herein are those of the author and should not be attributed to the National Bank of Poland.
Real Wages during and Post-Pandemic
While recent accounts have focused on the erosion of real wages with high inflation, what is true is that average real wages in the private sector, and amongs the lowest paid segment, leisure and hospitality workers, has risen since 2020M02.
How to End an Endless Debate
A long running debate between reader JohnH and just about anybody else on this website involves UK 2015 (1) inflation, and (2) real wages, with JohnH quoting from various documents. I thought it useful to GET THE DATA MYSELF to resolve the question. Below are three graphs, of consumer price level, year-on-year inflation, and the CPI deflated wage.