Real Earnings, Not So Much

Thu, 15 May 2008 01:25:28 +0000

The BLS released information on real earnings in April this morning, and the news is not encouraging:

Real average weekly earnings fell by 0.5 percent from March to April after seasonal adjustment, according to preliminary data released today by the Bureau of Labor Statistics of the U.S. Department of Labor. A 0.1 percent increase in average hourly earnings was offset by a 0.3 percent decrease in average weekly hours and a 0.2 percent increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

The last three decades have not been kind to real earnings. Take a look at the full history of the real earnings series:

The discrepancy between the series is the change in hours over this period--the series for average weekly earnings falls over the period because hours fall more than enough to offset the slight rise in average hourly earnings. Over this period, private employment has been a fairly constant share of total nonfarm employment (a bit more than 80%) and production and non-supervsory employment has been a fairly constant share of total private employment (a bit less than 70% also a bit more than 80%).

This is one of the most depressing graphs I've ever seen.