The inflation-adjusted wages situation in the United States has gotten so bad that the only good news contained in this morning’s Labor Department report on the subject was that real private sector hourly pay has now flat-lined since July, 2017. It’s good news because it means that in August its workers exited a real wage recession (a cumulative decline lasting two quarters or more) that they’d experienced starting last July.
Otherwise, by this key measure, American workers’ paychecks remained in the doldrums. For the private sector, constant dollar wages inched up by 0.09 percent between July and August, and year-on-year, they rose by only 0.19 percent. Between the previous Augusts, real private sector wages had increased by 0.65 percent.
Moreover, since the current economic recovery began – more than nine years ago – inflation-adjusted private sector wages have advanced by a mere 4.56 percent.
All the same, these pay improvements have been positively roaring when compared with developments in manufacturing. American industry remained in its real wage recession in August, with price-adjusted hourly pay down by 0.19 percent since January, 2016.
On a monthly basis, real manufacturing wages were flat in August, and year-on-year, they fell by 0.92 percent. Real manufacturing wages were off from August, 2016-August, 2017 as well, but by a mere 0.09 percent.
Perhaps worst of all, over the current nine-plus year old economic recovery, constant dollar manufacturing wages have risen by only 0.28 percent – less than a fifteenth as fast as real private sector wages.