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Real Hourly Wages Drop In September, Fail To Rise In 6 Of Past 7 Months
One of the greatest misconceptions plaguing modern economics is that just because there is broad inflation (real, not hedonic, seasonally-adjusted or a burst in Saudi Arabia dumping crude to pressure a Russian default), then nominal, and real, wages also have to increase.
The problem is that without the latter, there can be no actual economic recovery, and instead one ends with stagflation, something Japan is acutely experiencing right now.
Another problem: with nearly one hundred million people out of the labor force, and epic slack within the workforce, there is virtually no amount of inflation in this environment that can force corporations to not only stop firing people (see M&A bubble) but actually hike their pay (except of course for BTFD "traders" at major hedge funds and bank prop desks).
And just to confirm this, alongside the CPI data released earlier which showed the smallest possible broad price increase, when considering that previously the BLS reported flat nominal hourly wages in September, it implied that real wages declined once again. Sure enough, in a separate report today, the BLS announced that real average hourly earnings (in constant 1982-1984 dollars) declined once again, this time from $10.34 to $10.32, a -0.2% drop from past month.
This also means that since March, there has been just one month in which real hourly wages have increased, and that was mostly due to the outright deflationary print the BLS reported last month.
As for the flipside, there have now been 5 outright decreases in real hour wages since March of this year.
Putting America's real wages in context, the $10.34 real hourly wage is at a leve last seen in December 2008, just after Lehman collapsed.
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29.5 hr/wk jobs.....it's just math.
Thank goodness they haven't figured out a way to screw with math.
Of course "they" can screw with math.
0 plus interest = infinite profit.
Simples.
6 of past 7 years....typo
"which showed the smallest possible broad price increase"
Total Fiction
But why don't people ask for a raise?
See?
That's the problem! People are just to lazy! They just wait untill their boss gives them that monthly raise!
slightly o/t ... I have a largely anecdotal suspicion of an HR agency problem plaguing the economy, very much like the IT agency problem experienced in certain large corporations.
Theory...hiring managers spec jobs for skills they need and pass to HR which - as experts and a profit center of sorts - interprets, grades/prices, and goes to market to source talent that - as HR have no idea how to actually evaluate - they can't find any/enough of or, when they do, are not willing to bid inconsistently with their 'market evaluation'.
Symptoms include many openings unfilled for a long time and, as it can't be an HR process issue, cries (alleges?) a "skills gap" exists (which I highly doubt).
Meanwhile, the consumer economy slowly starts grinding to a halt.
Two sides to every trade and this economy needs more spending...would seem that if feds et al can lean-in to open the spigot on mortgage lending etc they should look in to this.
I've also got a funny HR agency fact.
To find somebody for a job they always use the same tests and mostly they find you somebody who has no skills but "will fit right in".
You'll need to train them yourself but for finding this person, the agency charges you 6 to 10 months of the salary of the found person.
And than we talk about keeping the salaries down???
SKIP THE HR AGENCIES AND ITERIM AGENCIES!!!!!
TOTALLY USELESS!!!!
They are afraid of retaliation
Time to bust out the sweaters. Winter of discontent is fast approaching.
There is one thing I have realized over the last 5 years.
Depressions suck.
pods
Maybe the iSheeple can use their iPhone to keep warm as well as distratced:
http://youtu.be/UnH-dPTFq2g
Boom causes bust.
More layoffs at HP and IBM, happy holidays. Jobs shifting to India and the Philippines.
i've been expecting layoffs
margins are/will be getting squeezed/crushed ... typically occurs at onset of inventory correction led recession ... the channel has been stuffed ... need to purge bloated inventory
Of course. That is how corporate profits are driven.
This will surely hurt the IT workers here in America - even though many of them are now Asian or Indian!
Watch what you say round eye! You want your email right?
pods
loling, seeing circles!
Welcome to part time America where real wages have been in decline since the 70s.
You're gonna throw that non-participation rate in our face.....aren't you?
"Let them eat (less) cake." - Yellen et al
If you like your falling real wages, you can keep your falling real wages...
hey, you didn't earn that...
Now we know why Mickey D's sold fewer burgers!
Saudis will NOT dump crude.
They will sell less volume and they will sell it for lower price in order to force oil in storage collaterized for derivatives to be dumped
half the story
average work week grew 0.3%
netting a +0.2% in real earnings for month ... +0.6% year over year.
not nearly good enough
Wages haven't gone up because there is no program in place to subsidize them, like there is with certain asset prices.
But wages, like gold, tell a more believable story about where prices are headed. And it isn't upward.
The trend is deflation. Prices will decline, or consumer demand will fall off until they do. The global economy is downsizing, and no amount of price supporting will change that.
When prices (ALL prices!)finally settle to their true level, then and only then will we be able to begin to grow again.
work for less than you are worth training new entries with language barrierss. can't fucking wait to be one of hundred to do this...
This has nothing to do with 6 million government sponsored immigrants a year for 30 years! This has nothing to do with shylocks regulating rungs out of the ladder, year after year! This has nothing to do with 50 million people grabbing for the same rung at the same time! Nothing! Nothing! Its all YOUR fault! You aren't smart enough! You don't work hard enough! You didn't fuck enough! You watch too much tv! You take up too much space! We need moar programs! You must buy us moar programs! And don't you dare even mention the voting and taxing dual citizens!
Democratic plantation workers fretting over lower wages or free shit. Decision, decisions.
No Social Security Cola for seniors ... eat hot dogs, not steak or even burgers! Save the pork and chicken for China.
Beat income inquality. Get a job!
aye, Smithfileds sold off - and subsequent "pig flu" stories,
then "US" chikken is shipped to China for "processing" and shipped back to amrkn consumers?
pwnd. what part of "global" still needs explanations??
I can’t believe real wages are not increasing!
Capitalist always acknowledge that the people who work for them are the companies greatest asset.
Even though increasing wages impacts the bottom line in a manner which can reduce EPS, Profits and stock values negatively, these Capitalists always sacrifice their per share reward for the benefit of the workers.
It has been so for many, many years.
They have said so on CNBC thousands of times.
This article must be mistaken.
/sarc/
Stagnant wages and inflation is running 2% per year (comical) for the last 20 years it would seem most people have 40% less purchasing power. Thank God for the illusion of the wealth effect.
Low wages = corporate profits
Mass lay offs = moar corporate profits
Stock buy backs = even moar corporate profits
= stocks to the moon
in a consumer based economy with wage drops, deflation has to be the end game right? the only way hyperinflation will hit the US, is the dumping of USD from foreign holders or the crack up boom printing by the fed in QE 4?
Wages is killing the economy....
And this is why we are in a recovery.
Funny how both the GOP and Dems aren't talking about this. Actually, its not. They are all paid corporate whores.