Yet another report has surfaced showing that while employment is picking up, wages remain stubbornly stagnant:
Employers in the United States are hiring at a brisk pace. Unemployment has sunk to a nearly healthy rate. Jobs are being filled across a range of industries.Yet the September jobs report released Friday contained a puzzling fact: Paychecks still aren’t growing. Economists regard stagnant wages as a red flag for the 5-year-old recovery. Robust job growth has typically fueled rising wages. And without higher pay, workers have less money to spend and save — and that, in turn, keeps the economy from strengthening further.
Wages are the backbone of an economy. Without workers making a decent wage, demand for products declines. As demand declines, jobs suffer in a vicious cycle.
When economies boom but wages don’t improve, it constitutes a theft from the workers who actually produce the wealth, by the corporations and the asset classes who then stash it in accounts that don’t serve to stimulate the economy. That injustice and rising inequality has a destabilizing effect not only on the economy, but on society itself.
The gap between the wage economy and the asset economy also presents itself in housing, which has seen geometric growth over the last few decades even as wages have stagnated. That’s great for people who bought into the market decades ago and held on. It’s brutally awful for people who bought in at the top, and for new buyers who will never be able to afford anything close to what their parents could.
Neither justice nor real economic growth and stability will be achieved unless there is a real and marked rise in wages.