Higher Wage Hope Hammered As American Worker Compensation Slumps

Tyler Durden's picture

US labor productivity rose 3.0% QoQ in Q3, the biggest rise since Q3 2014. 

Great news, right?

Not so much, as the rise in productivity comes at the expense of the wages of the American worker who saw unit labor costs (wages) decline 0.2% (against expectations of a 0.2% gain) - down for 2 straight quarters for the first time since 2014.

Real compensation declined 1.1% YoY - falling for the fourth straight quarter...

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cheka's picture

free trade bitchez

Five Star's picture

Meanwhile stocks have never been more expensive in terms of working wages 

http://thesoundingline.com/us-equities-are-the-most-expensive-ever-in-te...

NoDebt's picture

Meanwhile, on CNBC, they are warning this same report means that the job market could "overheat":

https://www.cnbc.com/2017/12/06/private-payrolls-grow-by-190k-vs-185k-es...'

 

YUNOSELL's picture

but at least I'll save about $16 a year with these new tax cuts, if it don't get inflated away

silverer's picture

Oops. Sorry.

www.chapwoodindex.com

What are you going to do with those three or so dollars? Wait! Don't tell us! Surprise us a year from now.

GotAFriendInBen's picture

But I thought Trump and the Rep tilians had our backs????

You mean to tell me they passed this bill without our best interests in mind?

We're not part of MAGA??

WTF!

 

GotAFriendInBen's picture

But I thought Trump and the Rep tilians had our backs????

You mean to tell me they passed this bill without our best interests in mind?

We're not part of MAGA??

WTF!

 

Stroke's picture

The rent is too damn high!

E.F. Mutton's picture

"Can't get around the ol' minimum wage, Mortimer"

LawsofPhysics's picture

Yes, but the real minimum wage is in fact zero.

Bubble Man's picture

"Yes, but the real minimum wage is in fact zero."   

  True, but a minimum wage was only introduced and needed when you live in a fiat money system where unproductive workers such as government and finacial manipulators skim all the wealth from productive work. And when those productive workers make enough to pay their bills and maybe buy a house, than they are getting paid to much so the non productive workers ship those productive worker's jobs overseas and call it free trade. Arguing the justification of a minum wage is irrelevant as long as we have bad money (gov't fiat) as the measuring stick and being used as money.

 


 

 

 

LawsofPhysics's picture

The global plan for the elite has always been to get everyone to work for the lowest wage possible...

What the fuck people, where have you been?

"Full Faith and Credit"

Rainman's picture

Alas, cheap credit ( aka  payday loans )  fills in the gap for the win !

Crazy Or Not's picture

>payday loans...
Amazon, Walmart, Pawn Shops, Thrift stores and bailbonds are the new model when workers pay barely reaches subsistance levels.
Where do the consumers come from in the Robodrone future? Gets more dystopian sci-fi every day.

Let it Go's picture

It is very important people understand that economic growth does not necessarily equal economic strength. The article below highlights the fact that not all economic growth is equal.

 http://Economic Growth Does Not Equal Economic Strength.html

D.T.Barnum's picture

#SlaverySlaverySlavery!

ThrowAwayYourTV's picture

Triple up economics.

Seasmoke's picture

Looks like slavery to me.

redmudhooch's picture

Make Slavery Great Again?

JBilyj's picture

The advertising redirects on this site sucks dick and makes browsing on a mobile phone a PITA...

GotAFriendInBen's picture

The deeper the slaves become indentured as baristas and greeters, the longer ZIRP can stay

A never ending cycle of depravity they've built

silverer's picture

The government knows you'll work for free if they post armed guards to watch you. So that's the plan. They keep everything, you get only as much as you need to work for free.

LawsofPhysics's picture

exactly who is "the government"?

do tell, do tell..

LOL!

Ricki13th's picture

But congress said that tax cuts will cause corporations to invest in the American worker. Why is wages falling despite all the extra cash they have. Sad!

swmnguy's picture

In our system of corporate Finance capitalism, labor is only an expense to be cut.  Even supplies are assets, but not labor.  So ultimate efficiency would be no employees, no customers, and 1 penny of profit.  Of course nobody stops to think that their employees are their, and everybody else's, customers in a consumer society.

As usual, short-term greed has cut its own throat.  The workers whose wages have been stagnant for 40 years aren't buying as much because the baseline cost of living has increased meanwhile.  And the Best and the Brightest can't figure out why Millennials aren't buying houses and getting married and buying fancy new cars.

Meanwhile, we hear promises that the manufacturing jobs that built the American middle class will be coming back!  Hooray!!  Except, when those jobs built the middle class, they paid a middle-class wage.  Now those jobs pay $5,000 a year in China and Mexico, and they won't come back here until that's a wage Americans will take because they have no choice.

All those coal mining jobs?  Yeah, the coal mines are indeed hiring.  $13/hr.  You have to provide all your own safety equipment; protective boots, helmet, goggles; so hundreds of bucks out of pocket, to get a chance to earn...$13/hr.  Because nobody wants to burn coal, because it's more expensive than natural gas or renewables for producing electricity.

The Americans who weren't born to rich parents need to understand that the rich really hate them, consider them morally inferior, and will punish them and rip them off at every turn.  They'll figure it out eventually, but first they're going to have to be betrayed by everyone, looks like.  They keep falling for the fake-populist feudalists.  It's the poor that are the main source of support for the British Royalty, too.  

dasein211's picture

Seriously though, more than half the people posting here are too blinded and deaf from their echo chambers to understand that. They think there’s a difference between right and left wing politicians.

swmnguy's picture

Too true.  And it's far from just people here on ZH.  Though until about 3 years ago, more ZH'ers did have a real interest in economics and how things actually work.

But then, look at the supposedly "left wing" politicians.  They sure seem to hate Trump, don't they?  For what?  If you analyze their arguments, they hate Trump because he's rude.  They don't seem to mind his continuation of the 40 year assault on the American middle class.  They bicker about the details, because the group of the donor class Trump showers favors on is a different group than their group of donors; that's about it.

And then there are the people who think everything is gender or race or some weird combination of the two.

Nope, the dividing lines in America are the same as they've always been.  It's class, baby, economic class.  All the other stuff is a red herring, a distraction, a dodge.  Americans on rung #2 of the "Ladder of Success" can be cajoled into stomping on the fingers of those on rung #1, and those on rung #1 will stomp on the fingers of those reaching up from the dirt floor.  And none of them recognized the boulders and boiling oil being dumped on them from above.

I grew up poor in rural America.  When I worked hard and got an education, you'd think people would say, "Now, there's an Enterprising young man, looking to better himself and his community."  Nope.  I got, "Oh, hey, College Boy, you think you're better than everybody else?  We know you.  You're no better than the rest of us.  You think you're going to make it in The Big City?  You'll come crawling back.  And no, I'm not going to hire you, because I can hire somebody who knows who his betters are."  No shit, I heard those exact words or close enough, 35 years ago in farm country.  So yeah, I went to The Big City, and now I'm in the top 25% or so, and I don't ever go back "home" and never will.

America took a brief detour from Feudalism from about 1945-1970.  And now a majority of us are cheering the regression, thinking somehow our tribal and feudal overlords will reward our loyalty if we show sufficient brutality to those below us.

CRM114's picture

Agreed. Thank you both for keeping the quality of argument up!

Dumpster Elite's picture

Now, now, I'm sure that cutting the corporate tax rate will just make wages for the working guy and gal fly through the roof! After all, this corporate windfall ALWAYS "trickles down" to you and me eventually....right?

swmnguy's picture

You're right.  Because Business is just another word for Charity.  The wealthy Elites are just dying to hand over their money.  The only reason they don't is because they just aren't quite rich enough, that's the problem.  

Anybody who has ever run a business knows the only reason anybody ever hires anybody else is when one can make more money by meeting more demand by hiring somebody else.  When the potential profits outweigh the cost of hiring somebody.  When there's minimal additional demand, you don't hire somebody else.  When you can meet the demand with your current level of labor cost, you do.  You don't hand out raises because you have more money in your pocket.  You hand out raises when it will make you even more money to hand out raises.  When it will cost you more to replace the people you already have.  Which is why we see so much emphasis on robots and automation, and more and more outsourcing and imports.  To cut labor cost, not raise it, because demand is not increasing.

Anybody thinking anything else is either deluding themselves or trying to deceive others.  And it's really discouraging to see people let themselves fall for the most obvious bullshit.  Between two equals, they wouldn't fall for it.  But when Authority Figures tell them so, they lap it up despite having seen the scam pulled time after time after time.  This time will be different.  This time I'll guess which shell the pea is under, I swear!

wmbz's picture

What we need is mo gubmint, much mo gubmint, to fix this shit. Why without mo gubmint we would not be where we are.

Vote early and vote often!

yogibear's picture

Loads of overseas H1Bs still pouring in.

They work cheaper and double the hours and always agree. Always fearful.

swmnguy's picture

And this new tax bill has a couple sweet items that will increase that trend.  The spiteful political attacks on Higher Education will make college and advanced degrees even more unattainable to the middle class.  The tax bill imposes taxation on Graduate Student tuition forebearance, which will hit every Grad student with taxes on what they'll now consider as much as $20,000, $40,000, of income.  When it's not income; it's not money any Grad student ever sees. 

Grad students don't have any money now.  Hitting them with $4,000 in income tax will drive them out of advanced degree programs.  And then US corporations will scream that they have to have more H1-B imported employees, because Americans are too lazy.  Because in reality Americans simply can't pay more money they don't have, and other countries are willing to invest in their labor force rather than try to extract every potential penny of debt from them.

It's like the difference between the list price of a medical procedure, and the negotiated lower price you have to pay through your health insurance policy.  I suppose the IRS could tax that, too, as "income."  No doubt they've thought of it.

Again, it's just Feudalism, with new terminology.

Bemused Observer's picture

That bit about the IRS taxing you on money you've saved is ridiculous. It's one thing to tax you on money you earn, but to try and nail you because you've managed to SAVE a few dollars is beyond stupid and overreaching.

Money coming in should be taxable, but if you are able to keep some money from going out, that should NOT count as 'income'. That's just being smart and managing your money well. NOT a taxable event!

swmnguy's picture

Well, you know, it's in those little gaps in logic that truth is revealed.  We get more of what we subsidize, and less of what we tax, right?  That's a Conservative article of faith, and it holds enough water to be worth using as a yardstick sometimes.

We don't want The Little People to save any money.  We punish work.  We bail out the spendthrift, and reward ownership which is mostly inherited.

Then we're shocked when the poor can't or won't "pull themselves up by their bootstraps."  Since we cut off their bootstraps through the Payroll Tax among others, it's not a mystery.

If teachers and professors voted Republican and donated money to the GOP, the tax bill would never have imposed these nasty little tax on graduate students.  That's pure political payback.  And really, really self-defeating, if the goal is to strengthen America.  Therefore, if we assume this faction of the Elites is at all rational, they have no intention of strengthening America.  They just want to turn the whole country into a debt-sink, from which they can extract profit.  Turn America into what they've turned Greece into, to name but one example.

I've been watching the GOP pursue this path since Reagan.  The Democrats went fully onto this path around that time too.  As Milo Yiannopolous said not long ago, there was no good reason for the Democrats to abandon their power base in the blue-collar working class.  That's the one smart thing he's said I can agree with.

It's interesting trying to raise kids who are just becoming adults these days.  They really need to understand how vicious the class warfare in America is, and the gaping differences between our cultural myths and our actual reality.  They need to get into the Professional class as fast as possible, because the Elites are hammering down the lid as hard and as fast as they can, planning for the moment they'll lock everyone in and start the building on fire.  The really huge fortunes are made in economic collapses, and they're certainly setting us up for one.  

Little things like this tax on grad students are just one odd detail that gives away the game they're playing.

CRM114's picture

The last two are the most important!

MrBoompi's picture

Now this news is sure to have the members of the Federal Reserve laughing, drinking, smoking, and slapping themselves on the backs in the private meeting room.  

surf@jm's picture

No problem........credit card debt at 30% interest will fill the gap......

rejected's picture

unpossible!

How are Muricains buying all those RV, Cars and $300,000 dollar houses!

How is Amazondotcon making all those profits? Oh wait.....

zippy_uk's picture

Replacing wages with low interest bearing beer tokens in 5,4,3,2,1....

Last of the Middle Class's picture

As QE props up zombie corporations unable to produce efficiently due to a myriad of problems, all related to a lack of competitive ability, employment falls and brings on a war on employees rather than increasing the employment rate. Corporate welfare (QE) destroys any drive for excellence (our government is a prime example) and politics becomes the employment qualifier of the day rather than ability.