Someone should teach the “experts” at the Federal Reserve some basic math, because apparently they suck at it. Addressing the Annual Economic Forecast Luncheon in Phoenix, Arizona, Christopher Waller, a member of the Federal Reserve Board Of Governors, claimed that wage inflation was helping drive up consumer price inflation.
Of course he is not entirely wrong. Wage inflation always follows monetary inflation, as workers try to raise their incomes to compensate. Some workers then indeed succeed in shifting some of the inflation to others by raising their wages. Of course as long as they succeed, total inflation continues. Wage inflation is hence simply a multiplier of the original monetary inflation.
The fact that it is lagging is a hence good sign, as that means that at least we are winding the multiplier down.
Before the lunatic lockdown, the average hours wage I paid my employees was $15 (Canadian). When our benevolent buffoon masters opened up what was not theirs to close, it shot up to $19. It continues to wreak havoc on my cost flow and structure. It's as if employees noticed there was a labour shortage and leveraged it to their advantage. We had to pay.
Few are worth the $19 and I wonder if there will be a price wage adjustment.
Of course he is not entirely wrong. Wage inflation always follows monetary inflation, as workers try to raise their incomes to compensate. Some workers then indeed succeed in shifting some of the inflation to others by raising their wages. Of course as long as they succeed, total inflation continues. Wage inflation is hence simply a multiplier of the original monetary inflation.
The fact that it is lagging is a hence good sign, as that means that at least we are winding the multiplier down.
I'm reading it that they are blaming "bosses." In other words, business people.
So they are saying business people are being "greedy" by being too generous?
Before the lunatic lockdown, the average hours wage I paid my employees was $15 (Canadian). When our benevolent buffoon masters opened up what was not theirs to close, it shot up to $19. It continues to wreak havoc on my cost flow and structure. It's as if employees noticed there was a labour shortage and leveraged it to their advantage. We had to pay.
Few are worth the $19 and I wonder if there will be a price wage adjustment.
What a bunch of tools.