5 ms·
How I understood it: the measure everyone thinks is wage growth (when we look at published economic data), is assumed to weight all workers equally: making it a
by JMTQp8lwXL 8y ago
How I understood it: the measure everyone thinks is wage growth (when we look at published economic data), is assumed to weight all workers equally: making it an unweighted average.
What people are actually citing is a metric that gives greater weight to higher earners than lower earners-- that metric is called Average Hourly Earnings (AHE). The name is confusing: it implies an unweighted average (because the word 'average' alone implies adding up all data points, then dividing by the number of points), but in actuality it's weighted.
If you calculate wage growth the way people assume it to be (an unweighted average), that growth number is greater.