The rich world needs higher real wage growth • Hacker News Board

Re: The rich world needs higher real wage growth

#91

Post by dalbasal » Sun, Jul 01, 2018, 5:18 PM UTC

abhiminator wrote: post #83

dalbasal wrote: post #56

This article really demonstrates how meaningless most economics reporting is, it's nearly as bad as markets/finance reporting. Oil is $75, about average over the last decade. It has almost nothing to do with employment, wage growth or GDP except inasmuch as all major economic measures affect eachother. A year ago oil prices were low, did that mean the opposite of this article (whatever that is) was true? This kind of…

I absolutely agree with you. This is a perfect example of superficial reporting. Surprised to see this from The Economist.

I think it might be worse than superficial. They're trying to trick readers into thinking that it contains more information than it does. Not cricket, Economist.

Re: The rich world needs higher real wage growth

#92

Post by markkanof » Sun, Jul 01, 2018, 5:19 PM UTC

mozumder wrote: post #36

rorykoehler wrote: post #30

Earlier quoted context omitted.

>This is unsustainable On what basis do you make this claim? I would have thought the opposite to be true.

Because people need to be located where they are most efficiently utilized in the economy. Everyone wants to live in New York or San Francisco, but the jobs are going to be distributed around the country. How are people going to construct a bridge in Ohio if everyone is in New York City? Jobs are still a local thing.

Everyone wants to live in New York or San Francisco? This is not true.

Re: The rich world needs higher real wage growth

#93

Post by oligopoly » Sun, Jul 01, 2018, 5:20 PM UTC

abhiminator wrote: post #83

dalbasal wrote: post #56

This article really demonstrates how meaningless most economics reporting is, it's nearly as bad as markets/finance reporting. Oil is $75, about average over the last decade. It has almost nothing to do with employment, wage growth or GDP except inasmuch as all major economic measures affect eachother. A year ago oil prices were low, did that mean the opposite of this article (whatever that is) was true? This kind of…

I absolutely agree with you. This is a perfect example of superficial reporting. Surprised to see this from The Economist.

Happens in every field. Compare what is said to reported or if you have knowledge of something, frankly could be anything sports, business etc, how poorly it's reported in the press.

Re: The rich world needs higher real wage growth

#94

Post by JumpCrisscross » Sun, Jul 01, 2018, 5:21 PM UTC

extralego wrote: post #87

JumpCrisscross wrote: post #73

Earlier quoted context omitted.

> Is it telling me that when unemployment is low, central bank policy is to raise interest rates? If so, why not say that? Raising rates aren’t the only way to solve the problem of (a) people who could be in the labour market but aren’t and (b) insufficient labour in the places it needs to be. Whatever it’s trying to do, it got me thinking about barriers to hiring in New York City. Are there steps we could eliminate…

You probably lost a great bartender and taco server. Honestly, I’m sorry to hear that. But her victory is very refreshing. What do you think? Why not discuss it with her?

> You probably lost a great bartender and taco server

I would have never tried the pastrami taco if it hadn’t been for her!

> Why not discuss it with her?

She’s campaigning. Not sure distractions would help. In any case, these sorts of proposals benefit from specificity. Next steps are doing homework and proposing specific rule changes.

Re: The rich world needs higher real wage growth

#95

Post by tfehring » Sun, Jul 01, 2018, 5:22 PM UTC

One thing to keep in mind: It's easy to think of stagnant wage levels as implying that everyone is working the same jobs and getting 2% nominal raises per year. Another possibility is that a subset of the population is seeing real wage growth while a different subset is being pushed into lower-wage jobs by automation and/or outsourcing.

The hivemind of Trump supporters would have you believe the latter, and while I'm decidedly not one of them, that explanation definitely strikes me as more plausible. Though I'd contend that there are probably 3 buckets, not 2:

- Those who work in highly-paid fields that aren't vulnerable to automation or outsourcing, including those who are driving the automation and outsourcing of other fields. These people see real wage growth.

- Those who work in relatively low-wage jobs (e.g., in the service sector) that are prone to automation and/or outsourcing, but for whom automation has been gradual because their low wages mitigate the benefits of automation and outsourcing. For these people, I suspect that real wages are more or less stagnant - they have no leverage since their jobs could be at least partially automated if it were worthwhile to do so, but it hasn't been worthwhile yet.

- Those who work in highly-paid fields that are susceptible to automation and/or outsourcing. Many of these jobs have been automated and/or outsourced due to the significant cost savings from doing so, pushing these people into lower-wage jobs. These are the coal miners and skilled tradespeople who form the core of Trump's voting base.

Of course, there are jobs that don't fall cleanly into any of these buckets - lawyers are a good example - but my impression is that this is still a good model for understanding wage levels for many jobs. Obviously I'm speculating quite a bit here (though BLS projections seem to support my argument [0]), so please let me know if you know of any evidence that contradicts this.

[0] https://www.bls.gov/emp/tables/industries-large-grow-decline...

Re: The rich world needs higher real wage growth

#96

Post by baursak » Sun, Jul 01, 2018, 5:24 PM UTC

dalbasal wrote: post #56

This article really demonstrates how meaningless most economics reporting is, it's nearly as bad as markets/finance reporting. Oil is $75, about average over the last decade. It has almost nothing to do with employment, wage growth or GDP except inasmuch as all major economic measures affect eachother. A year ago oil prices were low, did that mean the opposite of this article (whatever that is) was true? This kind of…

Relevant: https://www.theatlantic.com/technology/archive/1991/10/-quot...

"The magazine is written by young people pretending to be old people... If American readers got a look at the pimply complexions of their economic gurus, they would cancel their subscriptions in droves."

Re: The rich world needs higher real wage growth

#97

Post by wildmusings » Sun, Jul 01, 2018, 5:25 PM UTC

tfehring wrote: post #95

One thing to keep in mind: It's easy to think of stagnant wage levels as implying that everyone is working the same jobs and getting 2% nominal raises per year. Another possibility is that a subset of the population is seeing real wage growth while a different subset is being pushed into lower-wage jobs by automation and/or outsourcing. The hivemind of Trump supporters would have you believe the latter, and while I'm…

The numbers are pretty clear. The top 20%, which roughly correlates to the college-educated professionally-employed class, has seen their real income and social welfare steadily go up for the last half century. The bottom 80% has seen stagnation and decline, as well as increased social ills like drug addiction, broken homes, and so forth. Notably, this pattern exists even if you look at just white people, so a racial explanation won’t do.

Re: The rich world needs higher real wage growth

#98

Post by JumpCrisscross » Sun, Jul 01, 2018, 5:27 PM UTC

Joeri wrote: post #85

dalbasal wrote: post #56

This article really demonstrates how meaningless most economics reporting is, it's nearly as bad as markets/finance reporting. Oil is $75, about average over the last decade. It has almost nothing to do with employment, wage growth or GDP except inasmuch as all major economic measures affect eachother. A year ago oil prices were low, did that mean the opposite of this article (whatever that is) was true? This kind of…

This article really demonstrates how meaningless most economics reporting is, it's nearly as bad as markets/finance reporting. The problem is not with the reporting, it’s with the field. Economics is pseudoscience. It has all the trappings but none of the explanatory or predictive abilities. So you get articles like these that use a lot of jargon pretending like they’re making a strong case, but there’s no strong con…

> Economics can’t be a science yet

Macroeconomics, yes. Microeconomics is a proper science. It has theories which make predictions which can be demonstrated in experiments.

Re: The rich world needs higher real wage growth

#99

Post by dalbasal » Sun, Jul 01, 2018, 5:28 PM UTC

j-c-hewitt wrote: post #90

dalbasal wrote: post #56

This article really demonstrates how meaningless most economics reporting is, it's nearly as bad as markets/finance reporting. Oil is $75, about average over the last decade. It has almost nothing to do with employment, wage growth or GDP except inasmuch as all major economic measures affect eachother. A year ago oil prices were low, did that mean the opposite of this article (whatever that is) was true? This kind of…

Someone's gotta explain to me what "structural changes in the economy" means. Does it mean that the economy is like a big building and we added another floor? Is the economy now like one of those whacky nu-architecture prizewinning buildings that are shaped like giant globs of play-do? Or is it one of those phrases that can be used to mean absolutely anything at all?

That's exactly the point, it could mean anything.

In this case, I think "structural" is a euphemism for "equilibrium state," what would happen in the economy if everything stays as it is now long enough for things to settle down.

It's nonspecific even for a euphemism. "Structure" could mean "the type of products now made in the economy." It could mean "the fact that labour markets are internationalised," as the article stops short of alluding to a paragraph earlier. It could mean "the fact that we the economy is made of fewer, larger companies."

Re: The rich world needs higher real wage growth

#100

Post by Animats » Sun, Jul 01, 2018, 5:28 PM UTC

The emphasis on oil may reflect a European perspective. Only 19% of US oil is imported now, and the US generates very little electricity from oil. The US is a natural gas exporter. If the US wants energy independence, it's within reach.

At the other extreme, Japan imports essentially all its oil, as does the UK. Both import most of their natural gas.