https://www.wsj.com/articles/real-wages-are-rising-1536359667
Most headlines from Friday’s August jobs report concerned the 2.9% increase in wages over the last 12 months, the healthiest raise in some time. That figure was probably overstated due to a weak August 2017 falling off the 12-month comparison, but other data are showing that wages after inflation are finally rising as you’d expect in a tight labor market.
The August numbers reinforced the tightening trend. The unemployment rate stayed at 3.9%, and the rate for black Americans fell to a record low 6.3%; a year earlier the rate for blacks was 7.6%. The number of employed Americans fell, but much of that is explained by students returning to school. The same applies to the August dip in the labor participation rate. Overall the August snapshot shows a labor market in excellent shape, with nearly everyone who wants a job able to get one.
Which brings us to the wages debate. The economists who presided over the historically slow wage growth of the Obama years have been arguing that the Trump-era economic growth spurt is no big deal because wages after inflation aren’t rising. Their evidence is the average hourly earning increase, which at 2.7% in July wasn’t much above recent inflation that through July was 2.9%.