Economics
U.S. Wages Are About to Sink in an Odd Sign of Economic Strength
- Return of low-paid workers to push average wage growth down
- White House warns of ‘computational quirks’ that cloud picture
An employee works at a manufacturing facility in Cincinnati, Ohio, U.S.
Photographer: Ty Wright/BloombergThis article is for subscribers only.
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With so many gauges of the U.S. economy pointing to an accelerating recovery, and even a post-pandemic boom, it seems like a strange time for the government to warn that wages are about to shrink.
But that’s what is likely to happen with at least one key measure of paychecks -- thanks to another Covid-era quirk in the economic data, which led the White House to warn this week that growth in average hourly earnings is set to “decline dramatically” in the coming months. It may even turn negative on a year-over-year basis.