Heading into the November presidential election, one of the biggest issues on voters' minds is the economy. According to a new poll, 73% of Americans say strengthening it is their top concern.
So I spent some time looking into this wage increase stuff and I did find this fun chart with inflation adjusted wages growing 2% in the last 5 years, that’s pretty paltry compared to the corporate profit increases. I’d bet that power imbalance is a large factor in consumer sentiment falling against otherwise good looking economic data.
We’re in a weird economic time right now where the median is actually misleading.
Wages at the bottom are going up hugely (beating inflation by 12 percentage points). Wages at the middle (median) are pretty much unchanged as you noted. Wages at the top are falling behind inflation. I.e. inequality is going down for the first time in God knows how long.
I talk about it elsewhere in the thread and link to a couple articles, but the short answer is that you’re not wrong but median real wages aren’t the whole picture right now.
And yes corporate profits are a huge problem. There was a huge corporate tax increase in 2023 that funded some of the stuff the led to the 12% wage increase at the bottom end, but it’s nowhere near enough.
So I spent some time looking into this wage increase stuff and I did find this fun chart with inflation adjusted wages growing 2% in the last 5 years, that’s pretty paltry compared to the corporate profit increases. I’d bet that power imbalance is a large factor in consumer sentiment falling against otherwise good looking economic data.
We’re in a weird economic time right now where the median is actually misleading.
Wages at the bottom are going up hugely (beating inflation by 12 percentage points). Wages at the middle (median) are pretty much unchanged as you noted. Wages at the top are falling behind inflation. I.e. inequality is going down for the first time in God knows how long.
I talk about it elsewhere in the thread and link to a couple articles, but the short answer is that you’re not wrong but median real wages aren’t the whole picture right now.
And yes corporate profits are a huge problem. There was a huge corporate tax increase in 2023 that funded some of the stuff the led to the 12% wage increase at the bottom end, but it’s nowhere near enough.