One more point on the hourly compensation estimates as they relate to this supposed labor shortage. As I wrote in examining the Beveridge Curve from a different, and ultimately more consistent, perspective:

It just doesn’t work that way. In a real labor shortage, wage gains wouldn’t be modest because they couldn’t be modest. If they are modest, then the shortage is a kinda, sorta shortage rather than true to the meaning of the word in this context.

 

The only way those two really different parts could ever come together is if businesses don’t really care that there is a shortage because it’s not based on economic growth perceptions so much as regular churn.

Wage growth, here in the form of hourly compensation, isn’t even modest. It’s awful. Still.

That suggests, may even prove, it’s all an imaginary trend based on one number with a whole bunch of questions about its numerator as well as denominator. The unemployment rate tomorrow could be calculated at zero and it really wouldn’t make the slightest difference.

But inflation is about to explode higher.