CATHERINE RAMPELL
Dollars to doughnuts.
Job growth has been modest but steady in the last few months. Wages, on the other hand, have been falling since August, after adjusting for both seasonality and price increases.
Source: Bureau of Labor Statistics, via Haver Analytics. Hourly earnings are shown in September 2012 dollars, inflation-adjusted using the Consumer Price Index.
Assuming this is not just statistical noise, it’s possible that lower wages are enabling or encouraging employers to hire more workers, said John Ryding, the chief economist at RDQ Economics. When the price of something falls, buyers can afford more of it.
Another possible explanation relates to the types of jobs being created. If a sizable share of the jobs being created were low-wage jobs — which was the case from the first quarter of 2010 through the first quarter of 2012, anyway — the average wage could get dragged down.
For broader context on income stagnation over the last decade and its potential causes, check out this recent article by my colleague David Leonhardt.
Article source: http://economix.blogs.nytimes.com/2012/11/02/the-slide-in-wages/?partner=rss&emc=rss
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