The Last Refuge
October 17, 2018
The Bureau of Labor Statistics has released some remarkable economic data today. There are more than seven million current job openings [See Here] and the year-over-year average wage gains are 3.3% [See Here]
For more than three decades all U.S. economic policy was elevating Wall Street and diminishing Main Street. As a result the middle America blue-collar workers have not had wage gains keeping up with inflation for over 30 years…. Then came the era of Trump.
More than two years ago CTH began discussing the ramifications to a new emphasis on the economy outlined as a possibility of candidate Donald Trump’s economic policy outlook. Within the overall discussion we walked through the anticipated changes possible if A.) Trump won the election, and B.) Trump began instituting Main Street economic policyahead of Wall Street policy (the past 30+ years).
We discussed the new dimension that would occur between two economic engines (Main Street -vs- Wall Street) as three decades of policy shifted. CTH outlined statistical and measurable KPIs that would become visible in the space between the policy shifts.
Part of those discussions focused on energy costs, product costs (we explained how inflation would be weird), and importantly, wage rates. It takes several months of policy emphasis (actual outcomes), before the labor market wage rates would grow. We anticipated seeing that policy impact in Q2 of 2018, which was April-June 2018. When the BLS released their second quarter analysis of wage and benefit rates for American workers –SEE HERE– the rate of growth was 2.8%, the fastest increase in a decade.
At the end of the second quarter we shared the opinion that it was only the beginning of what was to come. Well, overall wage rate growth in Q3 has now climbed to 3.3%
BLS – Median weekly earnings of the nation’s…