The goal is to keep inflation at a low enough rate that wages keep up.
The goal is to keep inflation at a low enough rate that wages keep up.
https://fred.stlouisfed.org/series/LES1252881600Q
But they haven't have they? Median earnings are flat with Q4-2019 levels. Averages are higher because those of us fortunate enough to work in tech or healthcare are experiencing boom times, but for huge swaths of the country, things are looking very bleak. Take-home pay is the same, but the price of groceries and rent has continued to climb without abatement.
Obviously wages being flat isn't good when there is inflation, either - if they don't keep up you end up needing more debt because you can't afford to pay for everything out of your regular wages.
We're barely scratching the surface here, but modern economies have a lot of different cogs that really only turn properly in an inflationary environment. It just needs to be a lot less inflationary than it has been.