Last Thursday, the BLS posted real earnings month-over-month. Here are the charts.
Real Earnings All Employees
For all employees, the BLS reports “Real average hourly earnings increased 0.5 percent, seasonally adjusted, from September 2017 to September 2018.”
Real Earnings Production and Nonsupervisory Workers
For production and supervisory workers the BLS reports “From September 2017 to September 2018, real average hourly earnings increased 0.4 percent, seasonally adjusted.”
I created the lead chart by taking year-over-year earnings and subtracting the year-over-year CPI.
The BLS uses CPI-U for all employees and CPI-W for production and nonsupervisory workers.
The data series for nonsupervisory workers goes back much further than for all employees.
Real or Imaginary?
Workers may make more than they did a year ago if they are not in school, are not looking to buy a home, don’t live in a high rent area, and don’t have to pay their own medical insurance.
Also, the numbers are averages. The median employee is no doubt losing to inflation even if they are not in school, are not looking to buy a home, don’t live in a high rent area, and don’t have to pay their own medical insurance.
Mike “Mish” Shedlock
As long as printing Washington’s face on paper sheets don’t create any real wealth, it is a mathematical certainty that some have get robbed, for others to enjoy unearned loot, in the form of asset appreciation resulting from the printing.
CPI is probably exaggerated, by public servants who are trying to increase their pensions beyond what the actual inflation is. However, having said that, such weak wage growth calls the legitimacy of “low unemployment” into serious and severe question.
They did get a tax cut. And employers are probably paying more for their benefits. Neither of which shows up in the salary report.