Economics
Fed Study Finds Wages Adjusted for Baby Boomers Are Rising Just Fine
- New research says retirements depressing average earnings
- Pay growth for those staying in work force equals 2007 peak
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It’s a head-scratcher for many economists and a headache for Federal Reserve policy makers trying to decide if they should continue with gradual interest-rates increases.
Over the last 12 months, the U.S. economy has created more than 2 million new jobs, pushing unemployment down to 4.3 percent, yet average hourly earnings moved up just 2.5 percent. That’s helped hold down overall inflation, which has lingered below the Fed’s 2 percent target for nearly all of the past five years.