Wall Street Journal: Why Americans Aren’t Feeling Wage Gains
Republicans said their tax law would grow the economy and put money back in the pockets of working Americans, but evidence shows that wages aren’t increasing fast enough to outpace climbing health care, gas, and food costs, eroding any positive impact of the tax cuts. The Wall Street Journal walks through the details:
“Rising inflation is eating up more of U.S. workers’ paychecks.”
“Average hourly pay for private-sector workers, adjusted for inflation, was flat in April from a month earlier, the Labor Department said Thursday. Average weekly earnings, also taking into account inflation, fell 0.1% last month.”
“From a year earlier, real average hourly earnings for private-industry employees edged up just 0.2% in April.”
“In 2015, hourly earnings had climbed 2.4% annually in April because falling gasoline prices were holding down consumer-price measures. Though real earnings started to gain some momentum in the first half of 2017, the rate of inflation rose in the latter half of the year, keeping real wages in check.”
“‘If the average household is seeing prices at the pump, prices at the grocery store, prices for medical care... rising, but their wages aren’t following, then that becomes a constraint on consumer spending,’ said Gregory Daco, chief U.S. economist at Oxford Economics.”
“If wage growth continues to be lackluster as inflation rises, workers could see minimal or no gains in the purchasing power of their paychecks.”
“Average hourly pay for private-sector workers, adjusted for inflation, was flat in April from a month earlier, the Labor Department said Thursday. Average weekly earnings, also taking into account inflation, fell 0.1% last month.”
“From a year earlier, real average hourly earnings for private-industry employees edged up just 0.2% in April.”
“In 2015, hourly earnings had climbed 2.4% annually in April because falling gasoline prices were holding down consumer-price measures. Though real earnings started to gain some momentum in the first half of 2017, the rate of inflation rose in the latter half of the year, keeping real wages in check.”
“‘If the average household is seeing prices at the pump, prices at the grocery store, prices for medical care... rising, but their wages aren’t following, then that becomes a constraint on consumer spending,’ said Gregory Daco, chief U.S. economist at Oxford Economics.”
“If wage growth continues to be lackluster as inflation rises, workers could see minimal or no gains in the purchasing power of their paychecks.”