| ▲ | derektank 2 hours ago |
| >Regular people do not have more more money or time Of course they do. Median real weekly wages[1] have been rising for decades all while the average number of hours worked per worker have fallen[2]. [1] https://fred.stlouisfed.org/series/les1252881600Q [2] https://fred.stlouisfed.org/series/avhwpeusa065nrug |
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| ▲ | darth_avocado 2 hours ago | parent | next [-] |
| Meanwhile household basics increased faster than wages. In other words people don’t have more money. https://www.unitedforalice.org/essentials-index |
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| ▲ | chorsestudios an hour ago | parent | next [-] | | They do have more money, less spending power. | |
| ▲ | manlymuppet an hour ago | parent | prev | next [-] | | This is research from a labor advocacy group, with the explicit aim of the organization to advocate for this sort of thing. This doesn't mean the research is is automatically invalid, but it is bias worth mentioning. Looking at an article from the CATO institute, over the last 30 years wages have climbed 169 percent, while food prices 111 percent. But an even better measure is PCE, or personal consumption index. Rather than CPI, or any other "household basics" measure, which subjectively categorize goods and then tracks those, PCE measures the total dollar amount spent by the entire U.S. consumer sector on goods and services. This is what is used by the FRED database referenced in the reply above. https://www.cato.org/commentary/why-dire-pronouncements-abou... | | |
| ▲ | darth_avocado 3 minutes ago | parent | next [-] | | 1. PCE tracks spending by and on behalf of households, including employer-paid health insurance and government-funded medical programs like Medicare. Arguably this does not reflect out-of-pocket costs or the immediate cash-flow reality experienced by a regular household. 2. Shelter accounts for roughly 34% of the CPI, whereas it makes up only about 16% to 17% of the PCE which underplays the pressures of housing people face. Housing arguably is one of the most basic necessity and people will spend on it. 3. PCE also famously isn’t based on household surveys like CPI which means it doesn’t accurately represent the actual inflation either. 4. PCE also doesn’t accurately represent lifestyle downgrades even though it tracks them. PCE will capture if you swap chicken for beef (like people are doing right now) but the conclusion you’ll come to is that people have the same amount of spending power as before. | |
| ▲ | vlovich123 an hour ago | parent | prev | next [-] | | I feel like people complain about “food” but it’s a stand-in and that the cumulative increase in rent, transportation and food probably rose faster than wages. So Cato reply “but food hasn’t grown as fast as wages” is a myopic retort (admittedly one they acknowledge) that tries to fight the narrow factual argument ignoring the broader one where the emotional narrative probably remains true. | | |
| ▲ | pj_mukh 29 minutes ago | parent [-] | | Also we can probably simplify this bucket even more and just talk about the elephant in the room which is rent/mortgage. It’s 30 to 50% of most peoples paycheck, it’s really the piece that matters and the one that is most complicated to solve. | | |
| ▲ | infinite_spin 4 minutes ago | parent [-] | | a friend showed me their budget recently, and about 45 hours of their wages go to rent each month (for a single room in a house with roommates). That seems very high to me, and their rent is considered "low" in their area (a small suburb) |
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| ▲ | jparishy an hour ago | parent | prev | next [-] | | Hey thanks for posting this perspective w/ the link. Fun rabbit hole to go down stuck in a hotel tonight. I wonder if you think something explanatory is missing in _all_ of these different indices, in the "where there's smoke, there's fire" sense of economic anxiety on display today | |
| ▲ | openasocket 32 minutes ago | parent | prev | next [-] | | I’m not necessarily disputing your point, but it’s very odd to downplay one source for potential bias, and then follow up with a study from the CATO Institute. Like, the CATO institute is openly a libertarian think tank founded by one of the Koch brothers. I also think it’s unfair to look at just food prices. Housing and healthcare have bloomed massively. | |
| ▲ | rpcope1 19 minutes ago | parent | prev [-] | | > calls a labor advocacy group biased > Links the fucking CATO institute Pot, meet kettle |
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| ▲ | derektank 2 hours ago | parent | prev [-] | | The term “real” means the values are adjusted for inflation | | |
| ▲ | smallmancontrov an hour ago | parent [-] | | ...which is notorious for using a dogshit basket and basket-update methodology to make the number look good. | | |
| ▲ | Avicebron an hour ago | parent [-] | | Yup. The St. Louis Fed is a joke. Inflation of owners' equivalent rent alone blows the whole argument up.. |
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| ▲ | omgwtfbyobbq 5 minutes ago | parent | prev | next [-] |
| The CPI has gone up far faster than real wages. https://fred.stlouisfed.org/series/CPIAUCSL People are earning about 12% more and working about 5% less since 1980, but everything costs roughly 3x what it did in 1980 relative to wages, and that's where most people are pinched. |
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| ▲ | constant_flux an hour ago | parent | prev | next [-] |
| I don't find either of these charts dispositive by themselves. The cost of healthcare, education, housing, transportation, and insurance have easily outpaced any growth in wages. Another facet of this debate is that cheaper goods aren't necessarily of equal or better quality. > Of course they do. That level of certainty is not justified. |
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| ▲ | jparishy 2 hours ago | parent | prev | next [-] |
| Upvote for bringing data, since I did not. That said, that quote was in reference to AI, so referred to the past 3-4 years. And of course, our money today is not worth as much as it was 20+ years ago. Also many important goods and services increased in price at a higher rate than inflation or wage increases. It might be interesting to look at such industries for a history of consolidation or PE-involvement. |
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| ▲ | derektank an hour ago | parent | next [-] | | For what it's worth, I thought the rest of your comment was a very accurate description of how labor and capital are reallocated within an industry. The question is simply whether it's a bad thing that Hollywood studios have decamped for Atlanta and Toronto. For the people working in LA that don't want to move, I'm sure the answer is yes. But on net, I think it's probably meant more and better work for more people in general. | | |
| ▲ | jparishy an hour ago | parent [-] | | I really appreciate your perspective. Mine is definitely malleable on these topics; they're complicated and I'm not an economist. re: regular people and their money, I will say, something about the bigger picture just feels off. I look at the graphs you linked to, and do not see it reflected in the people around me. I don't mean to be dismissive of the data, more that I feel like I am missing something, or it is, if that makes sense? | | |
| ▲ | rectang 31 minutes ago | parent [-] | | Since the 1980s, the wealthy have done fantastic while the rest have not done nearly as well. The argument from CATO and others is that we should be content with the majority of households taking home a shrinking share of an increasing pie so long as their absolute purchasing power isn’t decreasing, but that argument feels wrong in part because it’s human nature to measure status relative to others rather than in absolute terms. Furthermore, wealth applies more pressure against certain costs like housing[1] than against others like food or durable goods. Cheap toasters only go so far in making people feel like they aren’t falling behind. [1] https://www.jchs.harvard.edu/blog/home-prices-surge-five-tim... |
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| ▲ | manlymuppet an hour ago | parent | prev [-] | | The data by the Fed linked above is inflation adjusted. | | |
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| ▲ | rectang an hour ago | parent | prev | next [-] |
| > the average number of hours worked per worker have fallen Hooray for just-in-time scheduling where workers have to be available full time but rarely get scheduled full time. It’s an innovation that has been great for capital and terrible for labor. |
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| ▲ | stonogo 2 hours ago | parent | prev | next [-] |
| Nicely sliced. Weekly wages for full time workers have been rising for decades while fewer workers work full time. I don't think this data backs your assertion. |
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| ▲ | derektank an hour ago | parent | next [-] | | The number of full time workers as a percent of the total employees has gone from roughly 84% (rounding up) in 1979 to roughly 82% (rounding down) today. There was a spike in people working part time in the wake of the GFC, but we've returned to trend. Also, I chose weekly wages because annual wages are complicated by time off, which was the other item in question. | |
| ▲ | manlymuppet 2 hours ago | parent | prev [-] | | Something like 80% of workers are full time. |
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| ▲ | scotty79 an hour ago | parent | prev [-] |
| 25% increase in half a century? We ahd like 3 technological revolutions since then and economy grew massively. Compare that to how much wealth appreciated, like a price of gold or real estate. Median real wages increased by the narrowest possible meaning of this word. Trickle down economy is literally a trickle. |
