What slowing wage growth? For the poorest the wages have essentially not increased for a long time right? It hasn’t even kept up with inflation. The recent bill actually makes it much worse.
> In stark contrast to prior decades, low-wage workers experienced dramatically fast real wage growth between 2019 and 2023
https://www.epi.org/publication/swa-wages-2023/
("real wages" are wages adjusted for inflation)
But getting >2x salary in such short order is outpacing pretty much everyone else, percentage wise.
You don't have to look far to see everyday people complaining about the price of a burger or movie ticket.
IMHO, it doesn't "lift all boats", it pulls down the middle and upper middle classes. Yeah, the lower wage jobs made more money, but they didn't gain much if anything in affordability, since all of the necessities are produced by people also demanding more money.
"you need lower wages to avoid wage compression", "you need lower wage so we can have more employed people"...
If wage compression occurs, then companies have to deal with Theo senior employees seeking elsewhere - or pay them fairly.
Historically, the lower wage jobs were for kids or bored folk, who'd eventually move onto something better and higher wages.
Recently, the economy isn't great and people take what they can find. There's absolutely no shame in that. I know people in tech who were making low to mid 6 figures now doing retail. The jobs just aren't there, and I constantly fear I'll be in the same boat soon.
But that inevitably does lead to wage compression, which to be clear isn't the fault of the lower wage earners.
But in other threads, people on HN said they don't even get out of bed for a 140k remote job. What gives?
This kind of emotional reasoning is wildly inappropriate IMHO.
The commenter is not making an argument against lifting lower class wages. They’re making an observation of how economic theory may apply to this scenario.
> pay them fairly
Define “fairly”?
In this case, I’m sure you can apply yourself and think of ways we can counter the effects of wage compression now that we’ve unemotionally identified the fact that it occurs.
The observation is not that vaccines have (side)-effects, but how these effects affect other people.
And that is what loads the argument.
In this context of wage compression it is fairly easy as it is just ensuring that they are paid comparatively more than the more junior employees that apparently are getting the same or close to the same salary.
It's hard to feel particularly bad for the them when the CurrentShitshow(TM) has largely been a result of the top-ish of the middle being comfortable enough that they're happy to peddle (sometimes at the behest of the most wealthy, sometimes organically) all sorts of bad ideas both economic and social that have kneecapped our economies and torn our societies apart. Like it wasn't the Uber Drivers who thought it would be a good idea to sell out the industrial portions of our economy and make race baiting a cornerstone of national politics.
I feel much greater sympathy for the cohort that currently works $15-25hr jobs and could have perhaps moved to $30-40 roles over time, bought a house and raised some kids in general economic stability if not for fairly self imposed costs and instability.
In addition to state and local governments setting their own minimums, the decline in young people and competition for workers in that sector from food delivery companies, has put wage pressure on fast food companies. Most wouldn't be able to open their doors if they tried to pay the Federal Minimum Wage. Had it been pegged to inflation, it would be $10.90/hour, which is less than what fast food workers are paid almost anywhere.
Also, predatory debt trapping, in part due to social media exposure and student loans, is way bigger thing now.
I'm not in the US, but our inflation data was just as wrong as I've heard the US data was. Official numbers were 10% but literally everything went up at least 20%. Everyone I spoke to had their cost of living increase by significantly more than the official inflation figures.
And when "real wage growth" over 4 years is deemed to be just 13%, it's essentially guaranteed that real wage growth was in fact negative when you consider the disparity between real and official inflation figures. Statistics such as food insecurity rate, personal savings rate, and credit card delinquency rate would certainly support that.
Because a hard life feels harder when prices rise. If you're at the bottom of the wage statistics, even a large increase in salary (eg. 20%) will still leave you struggling day to day, before inflation in your costs.
> Official numbers were 10% but literally everything went up at least 20%
Inflation numbers consider a wide variety of things. It's probably at least partially the reality that the necessities are rising faster than discretionary purchases. As an example, iPhones are "cheaper" today accounting for inflation since Apple hasn't raised prices much, especially on the high end. Obviously the poorest X% of people aren't buying new iPhones, so they don't get those savings.
Anecdotally, my grocery bill for packaged goods has risen dramatically, while my produce costs are flat. I'm a vegetarian so IDK about meat costs. My utilities have risen, my housing costs have risen, and my subscription prices have risen. Meanwhile, most of my other non-travel spending (eg. home goods like towels, electronics, etc) is pretty flat for years.
Largest increase has been on every fresh food item grown in our many greenhouses. Such as lettuce (increased 200% from ~1 to ~3 for iceberg lettuce) and tomatoes.
I keep a decent memory of pricing at multiple stores and can agree with part of your comment, packaged food got it worse.
Edit: Ontario Canada
facts and experiences are two very different things. Despite wages going up, poor people can still experience hardship and the feeling of always missing out / having less. it's a matter of contrast, not numbers. And that contrast, that's formed by lived experiences, not some report numbers or percentages thrown around here n there.
Policies should aim to elevate lived experiences of people, not change some numbers here and there to make the facts more confortable morally -_-.
All the math that underpins the usual idiots screeching about "muh compounding gains/interest" applies to the divergence between real inflation and official inflation as well. You can hide a lot of divergence between the real value of the currency and the official value by "simply" having the official number be low by a couple percent over time.
I'll give an example. In 2019, a 1bd apartment near me cost $800 per month. The McDonalds paid $7.50 per hour. Today the same 1bd costs $2000 per month, and the McDonalds pays $15 per hour.
So both can be true. Wages have gone up 100% for the low income worker, which is good news. But it's not enough to offset the cost of living increases, so they are actually worse off than they were before their wages went up.
Anecdotally, many people I know would be in dire straits if they didn't own appreciating real property, because their cost of living adjustments at work aren't coming close to matching inflation. Others I know are actually in dire straits. Some are doing fine and getting the benefit of profitable work. Overall things have been awful economically post-COVID, and there are a lot of causal factors, from the policy decisions of the last decade, to the surprises of COVID, natural disasters and geopolitics, to the AI investment bubble and the changing zeitgeist. (Oh and let's not forget simple demographics, birth rate, etc...)
If I had to put on my tinfoil hat, I presume we don't do this because it would illustrate how badly the poorest are affected by inflation, and validate the frustrations they feel and which are clearly reflected in economic sentiment surveys.
So it seems to me that any effects along those lines strong enough to exactly negate the apparent real wage growth in recent years must have either 1) been basically constant, so effective wages in this group actually declined 3.1% every year on average for forty years, making 2019 10th-percentile workers reduced to 28.4% of their forbears' wages, or 2) the inflation numbers were about representative for the 10th percentile worker from 1979-2019 and then suddenly and abruptly weren't, or 3) some combination of the two.
(or of course 4), the effect is real, nonzero, but not big enough to wipe out 3.1% apparent wage growth)
No. Nominal wages grew from ‘21 to ‘23, hitting all-time highs in ‘24 [1].
> It hasn’t even kept up with inflation
It did [2].