A Bloomberg analysis reports the startling fact that wage increases have been outpaced recently by inflation, rendering the new minimum wage an illusory benefit. Who'da thunk? The Bloomberg author bemoans the fact that "the U.S. economy has no system for making sure that wages keep up with inflation."
The fact is, though, that the U.S. economy has a fine way of making sure that wages keep up with inflation: keep increasing productivity and quit trying to control prices. The only way for the real value of wages to increase is for the real value of wage-earners' production to increase. Shutting down workplaces and printing money for stimulus checks isn't the same thing as production.
5 comments:
Sadly, no one--including economists--in government has studied economics. They've studied only political economics.
Eric Hines
Despite all the talk about 'Digitization' and 'Robots are going to take all the jobs', actual productivity growth hasn't been all that stellar:
https://tradingeconomics.com/united-states/productivity#:~:text=United%20States%20Nonfarm%20Labour%20Productivity%20In%20the%20United,persons%2C%20including%20employees%2C%20proprietors%2C%20and%20unpaid%20family%20workers.
Thats what you get when you put stupid people in government positions.
Thanks! I guess that's one consolation prize about the minimum wage, anyway. I feel 10% better.
Massive millions dead of delta aka wax dmg. Of course inflation. The supply shortagrs are already signs people cannot do their jobs.
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