Thread by @ArmineYalnizyan

@JimboStanford @justrea69482217 @jason_kirby @globeandmail Yes, the spike in average hourly wages after the pandemic hit was due to the changing composition of the job market (low-paid people-facing jobs shuttered). The tanking of hourly wages was as these places reopened.
Here’s the chart I submitted. Note the dotted line & legend.

@JimboStanford @justrea69482217 @jason_kirby @globeandmail I closed my #InflationNation series for @TorontoStar talking about the fact and fiction of the “wage-price” spiral.
thestar.com/business/opini…

tldr: wage growth more associated to unemployment rate than inflation rate, historically.

@JimboStanford @justrea69482217 @jason_kirby @globeandmail @TorontoStar Expect higher wage growth than seen for last 40 yrs, due to half century lows in unemployment.
Expect people to blame workers for inflation.

Labour is rarely the biggest factor of production.
In sectors where it is, like the Care Economy, governments like ON are capping wages.

@JimboStanford @justrea69482217 @jason_kirby @globeandmail @TorontoStar I couldn’t get enough space to publish this remarkable series of charts (same axes!) of the relationship between wage growth, inflation rates, and unemployment rates, from 1945 to today.
Wages measured 4 different ways in that period, so 4 different charts.
Check it out!

@JimboStanford @justrea69482217 @jason_kirby @globeandmail @TorontoStar From 1981 to 2001 wage growth was nonexistent (unemployment was very exceptionally high).
From 2002 to 2019, wage growth only exceeded inflation when unemployment was dropping to close to late 1960s/early 1970s levels (the last time we saw sustained wage growth).

@JimboStanford @justrea69482217 @jason_kirby @globeandmail @TorontoStar You’d think the dreaded “wage price spiral” was coined in the post-war and 1950s, when wage growth and inflation tracked one another more closely.
But no.
Conditions then closely resembled today: supply shortages, labour shortages.
Difference then? strong growth.

@JimboStanford @justrea69482217 @jason_kirby @globeandmail @TorontoStar Exhibit A commonly used to exemplify wage-price spiral is the 1970s. The oil price shocks (2, one in 1973, the other in 1979) DID see organized labour ask for more to catch up with price escalation.
Did they lead or follow inflation?
Chicken or egg?
More like: find a villain.

@JimboStanford @justrea69482217 @jason_kirby @globeandmail @TorontoStar Maybe will happen in 2023, as collective agreements come up for renegotiation.
And since a higher % of the public sector is unionized than private sector, expect blame games against unions, and public sector ones in particular.
Wage rage against workers is actually anti-market.