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May 22, 2020
It's the productivity, stupid!
All too many financial journalists fail to realize that productivity, not employer generosity, determines wages. (Actually, it is discounted marginal revenue productivity, but we don't have to go into all of that.) They write things like "average wages rose by 3%, but they increased more for supervisors than shop floor workers." Or "US workers see fastest wage growth in a decade, but ..." and go on to say something along the lines of these boosts being unfairly spread around. Then there is this complaint: "Americans' paychecks are finally kicking into high gear, with the January jobs report showing the strongest wage growth since 2009. Yet not every type of worker is benefiting." One journalist bewailed this fact: "For most U.S. workers, real wages have barely budged in decades[.] ... And what wage gains there have been have mostly flowed to the highest-paid tier of...(Read Full Post)