Advertise | Bookmark | Contact Us | E-Mail List |  | Update Page | UraniumSeek.com 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek Radio: Gerald Celente and Peter Schiff, and Chris Waltzek
By: radio.GoldSeek.com

The Housing Market Is Sliding Down The Wall It Hit In Late August
By: Dave Kranzler

Political Theater Goes into Overdrive as Shutdown Looms
By: Clint Siegner

SWOT Analysis: Will the Fed Hike Rates Again This Week?
By: Frank Holmes

Stock Market’s Stars are Crossed for an Ursa Major Upset
By: David Haggith

Watching For A Breakout In Gold
By: Justin Smyth

Technical Scoop - Weekend Update December 17 2018
By: David Chapman

A Turn In The Tide
By: Plunger

Gold Market Update
By: Clive Maund

Palladium?
By: Larry LaBorde

 
Search

GoldSeek Web

 
Why Aren’t Widespread Labor Shortages Translating Into Roaring Wage Inflation?


By: John Rubino



 -- Published: Friday, 10 August 2018 | Print  | Disqus 

Google “labor shortage” or “wage hikes” and the result is a picture of an overheating economy. Some examples from August 10:

911 Emergency: Call Centers Can’t Find Workers

Why Disneyland’s $15-an-hour labor deal is a win for workers everywhere

Colorado small businesses seek help with labor shortage

Washington growers struggle with labor shortage

Now hiring: teenagers (and anyone else willing to work)

Construction Labor Shortage Creates Increasingly Lucrative Career Paths

Jobs Go Unfilled as the Economy Expands

You can’t read these headlines and not expect wages to climb dramatically as desperate companies pay what they have to in order to keep their customers happy. But the macro numbers tell a different story. Here’s the change in average hourly earnings over the past decade:

wage growth wage hikes

Wages are clearly rising, but are 1) still way below the growth rate that prevailed heading into the Great Recession and 2) barely exceeding inflation, which means real wages aren’t rising at all.

How to reconcile wide-spread anecdotal labor shortages with slow to non-existent wage growth? Some possibilities, drawn from a recent MarketWatch analysis:

  • Older and higher paid baby boomers who retire are being replaced by younger workers who start out earning much less.
  • About half of all new jobs are being created in lower-paying fields such as package delivery, restaurants and social services. That is, the least educated workers are landing most of the new jobs, and are being paid commensurately, pulling down the average.
  • Companies still lack pricing power, in part because of foreign competition. If they can’t raise prices, raising wages mean sacrificing profit, which is never the first choice.
  • The implication? This expansion may have a little longer to run, since wage hikes aren’t yet sharp enough to spur the Fed to aggressive tightening. But eventually all those labor shortage data points will coalesce into an inflationary picture, as employers discover that their choice is between lower margins and extinction.

    At that point the Disney article you might have noticed above – in which the company granted 30% increases to a broad section of employees – will become the norm rather than the exception, and wage inflation will start driving the discussion. Here’s an excerpt from that article:

    Can the Magic Kingdom spread its fairy dust on America’s meager wage hikes?

    Disneyland and key unions just agreed to an eye-catching contract for roughly a third of its 30,000-plus workers that will bump pay for the lowest-paid workers by as much as one-third — yes, 30-percent-plus — to $15-an-hour by January. That’s three years before the state’s escalating minimum wage hits that mark.

    Organized labor’s high-pressure public relations battle with the theme park operator — no less, the realities of an ultra-tight labor market — convinced Walt Disney Co. to make a bold statement against what’s seemingly been long-running, conventional boardroom thinking: significant pay raises for the worker bee are history.

    The added significance of this stunning pay hike in an economic era featuring remarkable corporate penny-pinching is that this involves a closely-watched corporate icon that has been a managerial trendsetter.

    Workers everywhere — from other unions to individual employees to other Disney employees — should feel empowered to nudge bosses on pay. And if the request is denied, those workers may find a better-paying job elsewhere.

    Disneyland may not want to be seen as endorsing $15 as a workable pay floor — but this contract will hit that magic level three years before the state’s mandate.

    This Disneyland contract could be the forerunner of more significant pay across the tourism field.

     


| Digg This Article
 -- Published: Friday, 10 August 2018 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus







 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2019



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


Map

The views contained here may not represent the views of GoldSeek.com, Gold Seek LLC, its affiliates or advertisers. GoldSeek.com, Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, Gold Seek LLC, is strictly prohibited. In no event shall GoldSeek.com, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.