Re:Worker pay isn’t keeping up with inflation
by MichaelRazum on Friday December 17, 2021 @05:54PM
(#29599343)
Sounds strange. What about this graph
https://fred.stlouisfed.org/series/OPHNFB
I would argue that just based on the technological progress total average productivity per person should go up.
Re:Worker pay isn’t keeping up with inflation
by rsj_hn on Friday December 17, 2021 @07:06PM
(#29599899)
Yes, just based on that it should go up, but there's a huge difference about it increasing at 0.5% per annum and 1.5% per annum, and it's not going to go up monotonically, which is the difference between your long run graph and the latest BLS announcement.
In certain situations, when an economy is mismanaged, it will go down for prolonged periods of time, but again one year changes are not a significant trend. But this article about worker pay and inflation is not about long term trends, but recent (since 2020) trends.
(non-farm) Labor productivity declined by 5.2% year over year:
https://www.bls.gov/news.release/prod2.t02.htm
If you break these numbers down, you see that total production increased by 1.2%, but it required 7.4% more labor to produce that extra 1.2%. Compensation went up around 3% but of course in real terms it declined -- it pretty much has to decline if you need more labor to produce the same amount of stuff.
Whether or not this is a trend or some weird pandemic related thing will be seen over time.