Re:The Big Lie: 5.6% Unemployment
by adventured on Tuesday February 03, 2015 @04:06PM
(#8993368)
Of course wages were flat or down, there hasn't been a particularly strong - or sustained strength - labor market since 2000. In the 2005-2007 time frame there was a brief respite, and that of course was not only fake (powered by the housing bubble) but crashed.
Fact is, once enough slack is removed from a labor pool, wages rise. Happens every time.
It's exactly what occurred in the 1980s and 1990s. Wages weren't booming in the 1990s until the unemployment rate got to a certain low level toward the last several years of the decade.
I wouldn't expect wages to rise when U3 unemployment is 7% or 8%. I would expect to see it at closer to the 4% to 6% range. That's historically what has been the case, and we're seeing it happen again right now. If we add another ~3 million jobs in 2015, wages will rise at a healthy clip.
Fact is, once enough slack is removed from a labor pool, wages rise. Happens every time.
It's exactly what occurred in the 1980s and 1990s. Wages weren't booming in the 1990s until the unemployment rate got to a certain low level toward the last several years of the decade.
I wouldn't expect wages to rise when U3 unemployment is 7% or 8%. I would expect to see it at closer to the 4% to 6% range. That's historically what has been the case, and we're seeing it happen again right now. If we add another ~3 million jobs in 2015, wages will rise at a healthy clip.