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Comment by chiefalchemist | Hacker News Reader

To your point, every month we hear about the low unemployment rate, or the number of new jobs, etc. But we never hear about the average pay rate of the employed, or the pay and benefits of the new jobs created, or how many jobs someone has to work to afford a 2 BR place to live. Yes, sometimes these' things are mentioned in passing. But they're rarely is every used to make the case for "the economy is great..."

Zoom out far enough, use aggregate data, and avoid details, and you can make property on the moon as sexy a beachfront property in Miami.

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>But we never hear about the average pay rate of the employed

It takes 30 seconds search to turn up:

Employed full time: Median usual weekly real earnings: Wage and salary workers: 16 years and over

1982-84 CPI Adjusted Dollars, Seasonally Adjusted

https://fred.stlouisfed.org/series/LES1252881600Q

The source above is deflated by CPI, and shows that earnings has been flat compared to pre-pandemic levels. Not great, but not terrible either. Some other sources point out that if you use the PCE deflator instead, earnings are actually up modestly (3% since 2019).

https://www.economist.com/finance-and-economics/2023/11/30/r...

Now add the "All-Transactions House Price Index for the United States" line to the same chart.

I mean if you cherry pick which parts of the CPI basket to look at, you're almost guaranteed to find something that's growing faster than wages. The whole point of CPI is that you take all living costs into account, rather than cherry picking one particular item.

Sentiment is not rational in this way.

Ownership of a house is one of the major milestones of life. If many people are being prevented from achieving it, they are going to say things are bad.

Home ownership rates are down (a few %) from their historical highs pre 2008 but broadly higher than historical norms and trending upwards since a 50 year low in 2016.

https://fred.stlouisfed.org/series/RHORUSQ156N

The problem is that the CPI is pretty awful at identifying how much the expenses of those struggling most have changed, despite it being one of the figures most commonly brought up in discussion.

Someone who could only afford to purchase the cheapest essentials experienced a much larger increase in their living costs than the CPI would indicate. Yet it's still used, despite how misleading it is.

1. Wage data actually shows that the poorest are actually experiencing the highest wage gains, in percentage terms. Inequality is actually decreasing.

2. The CPI might not be perfect, but it's still better than a vague handwavy argument backed by zero statistics.

> 1. Wage data actually shows that the poorest are actually experiencing the highest wage gains, in percentage terms. Inequality is actually decreasing.

1. The wealthy don't typically look to increase their wages, mainly because it's much harder to dodge tax on them.

2. Only if the only statistic you look at is how much wages have increased in the last year, ignoring all of the other statistics like rent, rising food/energy insecurity, a decrease in retail volume yet increased revenue, etc.

> 2. The CPI might not be perfect, but it's still better than a vague handwavy argument backed by zero statistics.

Who said anything about being handwavy or lacking statistics? We have freely available data on how many people are using food banks, how much energy prices and rent have risen, on the much greater rise in the cost of supermarket own brand goods as compared to branded goods, etc.

We know for a fact that people are spending more and buying less. I'm not sure it takes a genius to understand that the people who were already struggling are going to suffer a much greater drop in their quality of life than the class whose main gripe is how "sad" it made them to raise their rents or lay off employees.

>1. The wealthy don't typically look to increase their wages, mainly because it's much harder to dodge tax on them.

The wage data in question[1] divides population by quartiles. This isn't comparing some minimum wage worker to jeff bezos.

[1] https://www.atlantafed.org/chcs/wage-growth-tracker

>2. Only if the only statistic you look at is how much wages have increased in the last year, ignoring all of the other statistics like rent

Instead of cherry picking a specific CPI component, why not look at the entire CPI?

> rising food/energy insecurity

source?

> a decrease in retail volume yet increased revenue, etc.

Maybe that's because the covid stimulus/savings bonanza has stopped?

>Who said anything about being handwavy or lacking statistics? We have freely available data on how many people are using food banks, how much energy prices and rent have risen, on the much greater rise in the cost of supermarket own brand goods as compared to branded goods, etc.

Present them, then.

So you're expecting 300 million people to take 30 seconds and look it up? Why should we have to collectively burn 1500 million seconds? While our "leaders" are feeding us "look all the sunshine" while we choke down a stack of bills and get slapped by inflation every trip to the supermarket. When was the last time anyone in W.DC did their own run to the supermarket?

*This* naive disconnect is part of the problem.

Also, you're presuming the source is trusted. When your gut feels like you're struggling, anyone who tells you otherwise isn't going to be met with trust and an open mind.

>So you're expecting 300 million people to take 30 seconds and look it up? Why should we have to collectively burn 1500 million seconds?

I'm not sure what the point you're trying to make is. Is it that if you take any number and multiply it by 300 million, you'll get a big number? Is it that the average american is so dumb and/or lazy that they need to have the news spoonfed to them by corporate media?

>While our "leaders" are feeding us "look all the sunshine" while we choke down a stack of bills and get slapped by inflation every trip to the supermarket.

We just established that inflation isn't eroding wages. I'm not even going to address the generic comment about bills.

>Also, you're presuming the source is trusted. When your gut feels like you're struggling, anyone who tells you otherwise isn't going to be met with trust and an open mind.

If you're going to reject government statistics and not entertain logical arguments because "your gut feels like you're struggling" or whatever, then it's clear that we're in conversation bizzaroland where anything goes and the only thing that matters is your feelings.

My point is, if there wasn't so much obfuscation and lack of transparency, no one would have to look anything up. It would be upfront.

Fwiw, I heard more than one news segment on the econony this past week. Each time it was the talking head and some "expert". Each time it was "the numbers are great, why isn't the public on board?" You know how you answer that...you ask the public. The fact that they don't and instead they force feed a narrative...that's a red flag.

Speaking about the US only (w/o actual data to back it up, just a feeling over the last year) is that lower-wage jobs have been on the rise out of the sheer necessity for businesses to attract warm bodies. Folks in the middle (low-middle -> high-middle( have had their wages depressed and lowered while the wealthiest individuals have had no impact or have seen their wages increased at or beyond inflation. The combination of very wealthy folks doing better and the lower income earners having higher wages has created dissonance around the reporting in the overall health of the economy IME.

Isn't number of Americans with two full time jobs at all time high currently?

No[0].

As a percent of population, number of Americans with multiple jobs is well south of where it was from 1994-2009.

[0] https://fred.stlouisfed.org/graph/?g=1cpAm

Somehow I bet that's counting "on the books" employment. There are plenty of people with (cash) side-hustles and such. How people cope financially today isn't the same as 30 yrs ago.

Why would there be more cash side hustles now than in the past?

If anything I’d expect the rise of side hustle platforms, all electronic payments and the ease of getting into it to lower the number of uncounted side hustles.

Don't know why you've been downvoted but you raise good points. Record low unemployment doesn't also mean record high QoL.

It's easy to reduce unemployment if you also cut back on welfare while CoL increases, forcing people to take whatever shit jobs they can find just to not become homeless, and voila now you have record low unemployment.

We've also had pretty good wage growth, but you'd never know because inflation is outstripping the wage growth so its negative. Which is why I'm puzzled why people keep touting the economy is so awesome. People are making more money, but it sure wouldn't feel like it when everything you buy is vastly more expensive. Even people on social media are talking about how they can't even go for a fast food meal anymore because its gotten too expensive.

Fast food, too expensive. Think about that for a moment.

> you'd never know because inflation is outstripping the wage growth so its negative

This is incorrect for most Americans and in most American zip codes [1].

[1] https://fred.stlouisfed.org/series/LES1252881600Q

2021: While those paychecks were 4.1% larger in November than they were in January, they will buy 2.8% less due to rising prices.

Those rank-and-file workers have suffered less than their bosses. For all private sector workers, including managers and executives, weekly earnings averaged 3.1% more but could buy 3.0% less.

2022: With an overall increase of 4.7%. But with inflation at 7%, the average person lost ground in terms of real income. This was particularly true for the middle half of earners who saw a median wage increase of only about 2.5%.

The picture was a bit better for low-wage earners, but not enough to shift the broader pattern for 2021: Inflation outpaced wage increases.

2023: Inflation roared back to the highest level in over 40 years, then slowed markedly. In all, consumer prices are up nearly 15.7%. Gasoline is up 51.2%.

Raw wages, unadjusted for inflation, have risen every quarter of Biden’s presidency, and generally at higher rates than wages rose under his predecessor, Donald Trump.

But once you adjust for inflation, many of these gains disappear. Real wages — that is, inflation-adjusted wages — fell or were unchanged during the first six quarters of Biden’s presidency.

>We've also had pretty good wage growth, but you'd never know because inflation is outstripping the wage growth so its negative

Source? BLS data[1] shows that CPI-adjusted wages are marginally up compared to pre-pandemic levels. There was a spike during the pandemic and current levels are down compared to that, but that's an issue with data collection rather than workers getting magically getting pay hikes during the pandemic. Specifically the lockdowns hit retail and hospitality workers the hardest. Those jobs also tend to pay low, so if those people aren't employed, the average goes up.

[1] https://fred.stlouisfed.org/series/LES1252881600Q

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