6 ms·

I think what's going on is, we're having period of high inflation. Here's my theorey: this high inflation is effectively lowering the minimum wage level becaus

I think what's going on is, we're having period of high inflation. Here's my theorey: this high inflation is effectively lowering the minimum wage level because minimum wage isn't keeping pace with the real rate of inflation. and because minimum wage is decreasing in real terms, this opens up lots of new positions that were made illegal by minimum wage. and so more and more people are finding jobs at the low end of the spectrum just above minimum wage and it's why the official reported Unemployment rates are so low and yet we have one hell of a sluggish economy. Conclusion: the low official Unemployment rates are not a reflection of a healthy economy, they are a reflection of decreasing minimum wages.

bryanlarsen 3y ago
Wages have been increasing faster than inflation for the last 10 months.
- WheatMillington 3y ago
  Across all earnings brackets, or only some? We know for a fact that the parent comment was correct that minimum wage has not kept up with inflation, and I'd like to see how earnings have compared to inflation across brackets rather than in aggregate.
  - bryanlarsen 3y ago
    average across all brackets. And it's per person. So specific jobs haven't increased that much, the big gains are in people switching employers. The biggest increases have been in the bottom 10% and the top 10%, union members and job hoppers. https://www.statista.com/statistics/1351276/wage-growth-vs-inflation-us/ https://www.statista.com/statistics/1351276/wage-growth-vs-i...
- CardenB 3y ago
  Bottom 25th percentile has been zero or negative growth at least back to 1998. This would include minimum wage and support the original argument. This doesn't seem to correct for inflation, so zero or negative wage growth is punished completely by inflation. source: https://www.atlantafed.org/chcs/wage-growth-tracker#Tab3 https://www.atlantafed.org/chcs/wage-growth-tracker#Tab3
  - ta2234234242 3y ago
    Sure but not everyone stays in the bottom 25%. College students would be one category that you would expect this to be true of. I was certainly in the poverty level in college, but not anymore. What we really care about are the people who are persistently in poverty and whether or not that number grows or shrinks. If it shrinks the economy is helping real people, if it's not, it's helping the well off.
    - janalsncm 3y ago
      I don’t think college students would be counted in this metric because it only counts people who want a full time job. A full time college student likely does not.
      - ta2234234242 3y ago
        You've never known college students to work full time jobs and take night school?
        janalsncm 3y ago
        I’m not saying it doesn’t happen I’m just saying it’s not a large enough demographic to explain why the bottom 25% should go down.
        ta2234234242 3y ago
        You didn't say that. I said it was only one category. There are perhaps others. Again, you need to look the number of people in poverty. Is it growing or shrinking? That's the true metric of an economy. When you get to 50% or more in poverty, that's revolution territory.
    - CardenB 3y ago
      So you are arguing that there is increasing mobility? Or do you argue that people are bouncing between jobs with lower wage growth and higher wage growth, so the bottom 25% of wages are getting worse and worse, yet they are only temporary? It seems pretty clear that 25% of earners experience no growth or negative growth YoY while 25% of earners see wage growth that outpaces inflation. Unless they are swapping places constantly, it's not really healthy for this to occur over a long period of time (as it has).
okaram 3y ago
Sorry, we are NOT having high inflation any more, regardless of what you feel or think.
- jrflowers 3y ago
  Whenever I hear people complain about rent or groceries I always politely inform them that the Δ Δ of their rent is quite low this month and that means the economy is in fact good
  - its_bbq 3y ago
    I'm sure that helps them pay their rent and put food on the table.
    - jrflowers 3y ago
      I wouldn’t go so far to call myself a hero for the wisdom I post but
    - ta2234234242 3y ago
      Some people believe a bad economy spurs skills development as people look to develop higher paying skills. They go back to college, they develop new skills, they do some training, etc, etc. That's what makes economics hard is that we're dealing with 400M walking talking humans in the US.
  - nradov 3y ago
    You're in good company. When President Nixon was campaigning for reelection in 1972 he told voters that the third derivative of inflation was decreasing. https://en.wikipedia.org/wiki/Third_derivative#%3A%7E%3Atext%3DWhen_campaigning_for_a_second%2Cderivative%E2%80%94the_rate_at_which?wprov=sfla1 https://en.wikipedia.org/wiki/Third_derivative#%3A%7E%3Atext...
  - Izkata 3y ago
    Aren't most rent contracts yearly? So that measure would be 0 most of the time, even when it's bad?
nickff 3y ago
This is basically Keynes' theory of wages and prices. https://en.wikipedia.org/wiki/Keynes%27s_theory_of_wages_and_prices https://en.wikipedia.org/wiki/Keynes%27s_theory_of_wages_and...

bryanlarsen 3y ago

Wages have been increasing faster than inflation for the last 10 months.

WheatMillington 3y ago
Across all earnings brackets, or only some? We know for a fact that the parent comment was correct that minimum wage has not kept up with inflation, and I'd like to see how earnings have compared to inflation across brackets rather than in aggregate.
- bryanlarsen 3y ago
  average across all brackets. And it's per person. So specific jobs haven't increased that much, the big gains are in people switching employers. The biggest increases have been in the bottom 10% and the top 10%, union members and job hoppers. https://www.statista.com/statistics/1351276/wage-growth-vs-inflation-us/ https://www.statista.com/statistics/1351276/wage-growth-vs-i...
CardenB 3y ago
Bottom 25th percentile has been zero or negative growth at least back to 1998. This would include minimum wage and support the original argument. This doesn't seem to correct for inflation, so zero or negative wage growth is punished completely by inflation. source: https://www.atlantafed.org/chcs/wage-growth-tracker#Tab3 https://www.atlantafed.org/chcs/wage-growth-tracker#Tab3
- ta2234234242 3y ago
  Sure but not everyone stays in the bottom 25%. College students would be one category that you would expect this to be true of. I was certainly in the poverty level in college, but not anymore. What we really care about are the people who are persistently in poverty and whether or not that number grows or shrinks. If it shrinks the economy is helping real people, if it's not, it's helping the well off.
  - janalsncm 3y ago
    I don’t think college students would be counted in this metric because it only counts people who want a full time job. A full time college student likely does not.
    - ta2234234242 3y ago
      You've never known college students to work full time jobs and take night school?
      - janalsncm 3y ago
        I’m not saying it doesn’t happen I’m just saying it’s not a large enough demographic to explain why the bottom 25% should go down.
        ta2234234242 3y ago
        You didn't say that. I said it was only one category. There are perhaps others. Again, you need to look the number of people in poverty. Is it growing or shrinking? That's the true metric of an economy. When you get to 50% or more in poverty, that's revolution territory.
  - CardenB 3y ago
    So you are arguing that there is increasing mobility? Or do you argue that people are bouncing between jobs with lower wage growth and higher wage growth, so the bottom 25% of wages are getting worse and worse, yet they are only temporary? It seems pretty clear that 25% of earners experience no growth or negative growth YoY while 25% of earners see wage growth that outpaces inflation. Unless they are swapping places constantly, it's not really healthy for this to occur over a long period of time (as it has).

okaram 3y ago

Sorry, we are NOT having high inflation any more, regardless of what you feel or think.

jrflowers 3y ago
Whenever I hear people complain about rent or groceries I always politely inform them that the Δ Δ of their rent is quite low this month and that means the economy is in fact good
- its_bbq 3y ago
  I'm sure that helps them pay their rent and put food on the table.
  - jrflowers 3y ago
    I wouldn’t go so far to call myself a hero for the wisdom I post but
  - ta2234234242 3y ago
    Some people believe a bad economy spurs skills development as people look to develop higher paying skills. They go back to college, they develop new skills, they do some training, etc, etc. That's what makes economics hard is that we're dealing with 400M walking talking humans in the US.
- nradov 3y ago
  You're in good company. When President Nixon was campaigning for reelection in 1972 he told voters that the third derivative of inflation was decreasing. https://en.wikipedia.org/wiki/Third_derivative#%3A%7E%3Atext%3DWhen_campaigning_for_a_second%2Cderivative%E2%80%94the_rate_at_which?wprov=sfla1 https://en.wikipedia.org/wiki/Third_derivative#%3A%7E%3Atext...
- Izkata 3y ago
  Aren't most rent contracts yearly? So that measure would be 0 most of the time, even when it's bad?

nickff 3y ago

This is basically Keynes' theory of wages and prices. https://en.wikipedia.org/wiki/Keynes%27s_theory_of_wages_and_prices https://en.wikipedia.org/wiki/Keynes%27s_theory_of_wages_and...