http://www.nytimes.com/2014/04/05/business/economy/sign-of-spring-for-pay-real-wage-growth-in-some-places.html?ref=economy
There are signs that the real wage is growing, indicating an improvement in the economy. After inflation, there was .8 percent growth last year, 1 percent growth this year, and a predicted 1.1 percent growth in 2015 according to Mark Zandi of Moody's. This is very encouraging. In some industries the rate of wage growth has been very dramatic such as home construction, where the wage has increased 20-25 percent. Hopefully this economic growth can keep up.
The real wage increasing is very encouraging, and hopefully companies can keep up with it increasing and not have more employee turnover. If unemployment rose, then obviously it would be discouraging to see a rise in the real wage rate. However, as we have learned, higher wages are a result from higher profits of companies, all resulting in a higher standard of living, so I think this is very encouraging like you said, Brooks.
ReplyDeleteAnd because of their higher income, consumers are willing to spend more which will really benefit the economy. Still, keep in mind that if things begin to grow too much then the Fed will increase the interest rate to slow down consumer spending, but for now things are looking good.
ReplyDeleteDue to an increase in real wages, disposable income per capita will increase as well which will encourage consumption. This is looking very promising for the economy, eventually we can look an increase in economic growth as well.
ReplyDeleteI think this is wonderful news, but they are still more work to be done. Increasing in real wages is a good sign of a decrease in unemployment and increasing in consumption. I think now the government should aim to decreasing its spending in order to alleviate its debt.
ReplyDeleteRaising real wage is good,but the growth rate is very low. I am doubt if the real wage growth rate can continue to develop. Also, raising wage affect the businee of the company. Still, the economy is bad,so we should think how increasing wage affect the business of company. And, increasing wage means increasing unemployment so we also care about that.
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