If the unemployment rate reaches zero and wages still don’t explode higher, the economy falls off, will Economists, central bankers, and the media stop relying on this one statistic for overall economic interpretation? You can be reasonably excited when the unemployment rate falls below 5%, as it did four years ago. Three point six, however, that’s something else entirely. We’ve [...]
In the absence of a booming economy, one has been conjured from a select few employment statistics. The catalog, beginning in 2014, consisted of a rapidly falling unemployment rate, the Establishment Survey which dazzled with headline payroll growth supposedly adding up to the “best jobs market in decades”, and the JOLTS series but curiously omitting everything but the Job Openings [...]
According to the BLS’s latest figures, real hourly compensation increased 2.2% Q/Q (annualized rate) in Q3. Wages and earnings are being closely watched, of course, for signs of acceleration due to the so far ethereal full employment level. That idea is taken from the unemployment rate even though, as in November, it has been as much determined by the lack [...]
The other part of payrolls, the far more important piece actually, is of course wages and income. Here there is nothing to speak of an increase in the jobs market to anything like what the Establishment Survey suggests. To that end, disconnect is apparent when comparing wage rates with (adjusted) estimates for utilization: The average hourly wage has been stuck [...]
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