Wage pickup, a long time coming, leaves investors unhappy
The pace of wage growth increased in January, with average hourly earnings up 2.9 percent year-over-year, according to the Labor Department’s monthly Employment Report. But real, inflation-adjusted wages have been nearly stagnant for decades, rising just 7 percent for the median household over the past 40 years, according to analysis by the Economic Policy Institute. And wages need to rise significantly faster than prices — driven by advances in productivity and labor-saving technology — for a population’s standard of living to improve long term. Not everyone is happy with the low unemployment rate and January wage growth in the Employment Report. The Dow Jones Industrial Average today had its worst day in almost two years. The NASDAQ and Standard & Poor’s 500 also took big hits. The problem? Investors see a lot of downside to low unemployment.
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