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Comment by Havoc | Hacker News Reader

Not sure it was done intentionally but generations following are pretty thoroughly fucked.

Eg average salary vs average house price charts

https://www.reddit.com/r/dataisbeautiful/comments/e1jrvw/oc_...

I think part of what we are seeing is a skills mismatch. It's not that the jobs aren't there imho, just that the population has not caught up. You'd think with the absurd amount being spent on college education this would not be the case, but alas it is.

Also we are seeing a lot of retiring trades workers and a shortage there. I have a feeling some of these professions are going to see a resurgence in wages relative to other areas of the economy.

I have been programming for 11 years but always have a hard time finding a job. My friends almost had no job through their entire 20's. They have degrees in stem, software, medicine, and chemical engineering.

Every field feels either dying or saturated. Every company gets hundreds to thousands of applicants per day online. If you walk in the building they tell you to apply online. It has been like this for as long as we have known.

The actual data does not align with your anecdote. Unemployment is historically low.

Something is not right if that is also true for CS grads as there are more CS grads than ever, unless they are moving into unrelated fields or worse, working part-time at a supermarket. For example, how many more web developers does the world really need especially when we have tools like Wordpress? Or is the industry hiring 10 people for every one person job?

Ha, my web developer friend got laid off, couldnt find a job, and now he drives the bus.

My other friend who has worked finance his whole life has had to work at a hardware store now.

People I know at software gigs are constantly telling me theyre scared of getting layed off. That includes at apple.

I know two junior devs who are working at grocery store, and a bar right now.

In so far as data is used to qualify politicians and support agendas, this argument is nothing more than a thought-terminating cliche. Data is so abused and any statistician or quantitative person can tell you how hard it is to collect quality data and support a conclusion with certainty without fooling yourself. And that's assuming good intent, the malicious/self-interested case is totally in play here, especially with regards to unemployment.

As so "trust me bro" is in effect eh?

is it incomprehensible to you that "the data says" is a "trust me bro" statement?

Yes, given that it is reported by trusted institutions such as the St Louis Fed. Now if you have alternative data or sources which are in conflict please share.

The conclusions you draw from data do not disprove what the GP said.

First you should be citing labor participation, and unemployment says nothing about the quality of jobs. Nevermind that even labor participation is definitive either. And considering the site "truflation" finds inflation since 2020 to be at 22%, that's a quarter devaluation of purchasing power which seems accurate to anyone participating in the economy. And to everyone celebrating "low" inflation now, that devaluation never goes away as the interest rate compounds and wages just aren't rising that fast either.

The point is that governments are trying to paint a rosy picture when many people participating in the economy do not believe it to be so rosy. And considering that politicians are performing atrociously, the reality is probably that the numbers are not capturing the reality of the economy.

It is very strange isnt it. There must be some nuance to be found in the data. Multimodality at the least.

We are also seeing an immense mismatch between worker productivity vs salaries. Per worker productivity has increased a lot since the 80s but most of the value added hasn't been translated into wages but captured by the capital elite.

While this happens it doesn't matter so much that societies adapt their skillsets, workers will keep experiencing wages depressed relative to their productivity. At some point this will completely break the social contract.

1 worker with a computer in 2000 can do the job of 25 workers in 1970.

It does not follow, however, that the 1 worker with 25 times more productivity should be paid 25 times the salary. That's financial insanity.

Unless the government voted to map work week hours to productivity so the 1 workers earns the same but works 25 times less. That's financial insanity mandated by the will of the people (i.e., the world we already live in). ;D

It doesn't need to be a linear correlation, but there should be some correlation between worker productivity (aka produced value per hour of labour) vs wages. It hasn't happened, at all [1]. And that's ridiculous, workers are much more productive while real wages have stagnated when inflation is taken into account.

> When it comes to the pace of annual pay increases, the top 1% wage grew 138% since 1979, while wages for the bottom 90% grew 15%

> Middle-class wages are stagnant—Middle-wage workers' hourly wage is up 6% since 1979, low-wage workers' wages are down 5%, while those with very high wages saw a 41% increase

[1] https://www.epi.org/publication/charting-wage-stagnation/

Maybe some has been captured by the "capital elite" or whatever that is (I think personally that is more a function of globalism). But it's also just been captured by society itself. We now have access to far more goods and services than ever before, and for incredibly cheap.

> Maybe some has been captured by the "capital elite" or whatever that is (I think personally that is more a function of globalism).

Whatever that is: it's the people who have capital to deploy, the ones who have workers, it's not a difficult concept.

> But it's also just been captured by society itself. We now have access to far more goods and services than ever before, and for incredibly cheap.

That is just products getting cheaper due to technology for production, the surplus value of labour is not in this equation. Society didn't capture part of the surplus of value, we just got cheaper products while wages stagnate and the capital class accumulated more and more of wealth.

Buying trinkets doesn't make you wealthier.

It's an inflation phenomenon, it largely stems from the explosive growth and centralization of the government post-WWII and subsequent abolishment of the gold standard. You exchange labor for Nancy Pelosi's (alternatively replace your preferred congress person) Chuck-E-Cheese tokens and those tokens are being created out of thin air (treasuries being the gold replacement) to finance whatever war, bureaucracy and any other boondoggle imaginable.

Now instead of getting tokens that are constrained in their scarcity (gold based), you've got constantly depreciating ones, which means your employer can pay you less every year without lifting a finger. The playing field is in their favor in an inflationary environment cause it's now the laborers' burden to search for new employment if they want a raise.

> I have a feeling some of these professions are going to see a resurgence in wages relative to other areas of the economy.

This is what should happen to wages in a competitive labor market where there is a legitimate shortage of a particular skill, but unfortunately companies will try to do pretty much anything except raising wages. So instead of paying plumbers $100/hr, the positions just go unfilled, and there's currently a multiple-month wait for any plumbing work where I live.

Where is that?

In Washington, DC, non-emergency plumbing calls might take a week. Emergency (forgot to turn off the outside water during a cold snap, basement flooded) seems to be handled quickly.

Let's just say NorCal, well outside the Bay Area. Agreed, somehow emergency service is fast, but non-emergency has quite a waiting list. Same for other types of trade service like HVAC repair, and even house painting. Another thing that can't be understated is how hard it is to just get these guys to call you back. Nobody answers the phone, and when you leave a message I'd say maybe 25-50% even call you back. Here I am with a fistful of money and nobody wants to take it.

It also took me 8 months to schedule a first-time doctor's visit, so maybe it's just the new normal for everything--not just the trades.

> It's not that the jobs aren't there imho, just that the population has not caught up. You'd think with the absurd amount being spent on college education this would not be the case, but alas it is.

It's the opposite. Many companies are too picky with their coffers

For my own curiosity it would be interesting to see housing prices bifurcated between London and not London. Other thoughts because the UK is a little bit special in the sense that most of the housing stock is quite old I believe...how do the prices look when comparing newer/older stock. I am wondering if new stock accounts for the price increases. Lastly, it would be interesting to see the role of the population, how much has the price changed per capita. Has there been a large influx of foreign money that has helped drive these prices higher and higher. Which could also be interesting to look at, perhaps you need to break the prices apart between luxury and non-luxury, maybe you get massive jumps in price with luxury properties.

That chart is basically all of western world. Some countries more than others but the pattern is pretty universal

Unsure about east & developing countries

No disagreement, just stating questions that I think would be an interesting analysis on top of the aggregate data. Home pricing has definitely outgrown wage growth.

London is the absolute extreme for house price, but the south west is often incredibly bad for house price to average income ratio.

Having said that there has been a definite case of “having cake and eating it too” from the boomer generation: when the retirement age was set it waa very close to life expectancy.

Now it’s 15-30 years behind, and the young are expected to fund those years of idleness from the elderly, often having enjoyed none of the state-supplied freebies the elderly got, while the elderly sit on the housing stock which should be used for young families.

This is nothing to do with luxury condos and foreign money (though those two are likely correlated in London) - it’s basic breakdown of social contract.

In my neighborhood (just outside the M25, so desirable for younger families), at least half of the houses are occupied by old people that are rattling around in houses that are far to big for them. They are waiting as long as possible to downsize because they like the house that they have been in for 40 years, and the asset continues to appreciate. We bought such a house last year, where the old owners couldn't climb the stairs anymore and they moved to a retirement 'caravan' somewhere. Their similarly old neighbors thought that they were making a big mistake, but we suspect that they needed the cash.

Four bedroom houses in commuting towns with garages and gardens, that are better suited to families, should not be endlessly lived in by retired people. As per a sibling comment, the social contract is broken, and there seems to be little incentive for existing owners to move the stock on.

We also have some very odd taxation in the UK with regards to property.

We have Council Tax (similar to property tax), which is a monthly charge for local services. Oddly based on house value in 1991 and regressive (richer you are, the less proportionately you'll be paying).

Stamp Duty, which is a tax on buying a house. We punish people for moving out of houses that are larger than they need, to a smaller one.

So we've got generations of people who weren't particularly rich, but have ended up in very valuable houses - and there's simply no incentive for them to get out of them.

We've sprinkled on some incentives to help first time buyers, but they're massively outweighed by the lack of 'stick' applied to the other side of the market.

Linked from the reddit post, this article (though US specific) has much more data that uses median vs average and breaks down by region..

https://listwithclever.com/research/home-price-v-income-hist...

This means almost nothing without accounting for interest rates.

Financing adds another complexity layer sure, but not sure how you conclude it means almost nothing

If you're trying to buy something super expensive with a salary that is small in comparison then you're going to have a bad time regardless of if it is outright or via financing.

If I'm understanding this chart correctly, people in the US people are now spending less on housing as a portion of disposable income than they did in 1980: https://fred.stlouisfed.org/series/MDSP

This also doesn't account for houses being larger, safer, and better (e.g. air conditioning) than they were 40 years ago.

Let's see a graph that goes back a few hundred years?

If you have one feel free to share

It was intentional but it was a small, very wealthy group that did it and is looking for a scapegoat for their sins in the form of your parents.

https://www.nakedcapitalism.com/2013/11/identity-politics-an...

Your article and the video both seem to agree that the different economic outlooks of the generations were achieved through policy, and the video demonstrates a split in voting by age. In this case it certainly takes two to tango - the wealthy to buy these politicians/policies, but also a certain bloc of voters has to keep voting for them.

>it certainly takes two to tango

It certainly doesn't. See https://www.cambridge.org/core/journals/perspectives-on-poli...

>Multivariate analysis indicates that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have *little or no independent influence*.

>the wealthy to buy these politicians/policies, but also a certain bloc of voters has to keep voting for them.

Why would you assume they only bought one party? The whole point of buying the political system is to constrain the options of the voting populace so it doesn't really matter that much who they choose.

The trick after becoming very wealthy via corrupting the political system, as Lord David Willetts knows, is to act surprised when you succeed and blame everyone's mom.

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