Debating The Bush Economic Record: Don't Believe Everything You Read About Wages

NDN have been going on about wages for some time now. We highlight the issue in the 3rd section of today's report - emphasing that flat wages and median income is the thin end of the administration's economic wedge. Today's papers, therefore, make heartening reading. Some revised labor stats seem to be suggesting that wages and benefits are growing strongly, says the Post. The FT is measured: wages are above expectations. Panic over? Not quite. Our current guest contributor Mark Thoma handily links to Paul Krugman's thoughts on the topic, in a discussion on the New York Times website:

So, are workers making out like bandits? Don't be surprised if you start seeing opinion pieces claiming that they are. But here's the thing: We have evidence from three different sources that tells a very different story. First, wages of non-supervisory workers, as measured by the Employment Survey, a survey of employers, are lagging slightly behind inflation. Second, median weekly wages, as measured by the Household Survey, a survey of (duh!) households, are lagging well behind inflation. Third, profits ... are growing much faster than G.D.P., which has to mean that labor costs are growing slowly.

We all want to see the pay packets of ordinary Americans begin to rise faster than inflation, something which hasn't happened under this administration. But don't think its happening just yet.