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Wages in U.S. down 23%; The truth for a change
Topic Started: 14 Aug 2014, 09:55 AM (2,049 Views)
goldbug
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While 8.7 million jobs have been regained since the 2008 recession, they are paying much less, by an average of 23 percent, according to a report released Monday by the United States Conference of Mayors.

The report comes as debate continues about income inequality in the United States. "While the economy is picking up steam, income inequality and wage gaps are an alarming trend that must be addressed," said Conference of Mayors President Kevin Johnson, the mayor of Sacramento, Calif., in a news release.

"We cannot put our heads in the sand on these issues. "The annual wage in sectors where jobs were lost, particularly in manufacturing and construction, during the recession was $61,637, but the average wage of new jobs through the second quarter of 2014 is $47,131, the report shows. It represents a loss of $93 billion in wages, according to the report.
(Go below to see the full report. )
http://www.cleveland.com/business/index.ssf/2014/08/wages_in_us_down_23_percent_si.html
Shadow was hopelessly wrong about the Gold Bull Market.
What else is he wrong about?
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Shadow
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Evil Mouzealot Specufestor

Quote:
 
Wages in U.S. down 23%
Yet house prices are rising...
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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herbie
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If 'official' inflation has been a little bit subdued, but your pay has dropped by 23%, could that mean you just might be being impacted by 'practical' inflation regardless? - LOL
Shadow
14 Aug 2014, 10:30 AM
Yet house prices are rising...
Yes, there's not much denying that ZIRP, QE and the USD hegemony have had some effects.
Edited by herbie, 14 Aug 2014, 10:43 AM.
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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Jimbo
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This is the inevitable consequence of outsourcing our manufacturing base to low wage economies.

UK wages also went negative in real terms having been negative or neutral in real terms for the last seven years.

The only things we don't outsource in the west are things we can't outsource like construction, farming and face to face customer service.

We have tried to get around this in Australia by using cheaper 457 welders and the UK have done it by being part of the EU and accepting thousands of Polish builders and plumbers who will work for minimum wage.

I know that the big resource companies outsource as much as they can. They have dongas built in China rather than by Ausco or Nomad. They have doc control, engineering and drafting conducted in offshore locations and before you know it, they will be driving haul packs from call centres in Karachi.

There is only one direction that wages can go in western economies and that I'm afraid, is down.
Edited by Jimbo, 14 Aug 2014, 11:33 AM.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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steve
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Falling real wages are what lie behind the worldwide push by elite interests to have migration controls removed in developed countries.

One of the unintended consequences of income inequality is the difficulty of growing aggregate demand, and therefore of growing profits. If the incomes of most of the population have stagnated (because the returns from economic growth are going almost entirely to the wealthy) then it is almost impossible to increase demand.

Some extra demand has been created through loose monetary policy and encouraging people to become indebted in order to maintain their spending. But there is a limit to this.

Some extra demand may be accessed by selling into export markets. But many developed-country businesses are either uncompetitive or are in non-tradable sectors tied to the domestic market.

So . . . . if domestic per capita incomes have stagnated, if the borrowing binge is exhausted, and if export markets are not accessible, there is only one variable left to fiddle with: the number of “capitas”.

If demand and profits are to grow then the population must grow.

This is not just an Australian problem. If affects elite interests in all developed countries. Hence the campaign (by elite institutions such as The Economist) to allow uncontrolled population growth through migration. It is the only way in which profits can be grown.

Thus we have the odd situation where developed-country elites suddenly find themselves having an overwhelming concern for the welfare of developing-country populations who wish to improve their position through migration.

Ahh! Such altruism. It warms the heart.

Of course, such a policy is not without its costs in terms of overcrowding. (That anyone could travel on London’s public transport during peak hour, then argue – as The Economist does – that Britain needs to squeeze in even more people is a triumph of self-interested belief over evidence.)

But then the developed-country elites who are pushing these policies are generally not the ones who will bear those costs. They will retreat to their mansions and country estates. They will not suffer the horrors of inadequate infrastructure and services. Their kiddies will have privileged access to the elite universities and professions and will not need to fight to find a decent job.

It is a policy designed to enrich the oligarchy which owns the government (of either party), while transferring the costs to the majority of people who have no say in government.

Conditions change over the generations but the determinants of economic policy do not. In all ages, those who possess political and market power seek to enrich themselves by exploiting those who do not.

If you want to address this problem, look to the root cause: the absence of democratic government, genuine democratic government.
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zaph
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Jimbo
14 Aug 2014, 11:32 AM
There is only one direction that wages can go in western economies and that I'm afraid, is down.
Unless we do things that the developing countries can't.
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DragonGM
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Technology means that developing countries can do most everything that we can do. The 'Western World's' unique advantage is over - and so with it goes our lifestyle advantages (and soon our house prices).
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Sydneyite
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DragonGM
14 Aug 2014, 11:56 AM
Technology means that developing countries can do most everything that we can do. The 'Western World's' unique advantage is over - and so with it goes our lifestyle advantages (and soon our house prices).
Who invents the technology?
For Aussie property bears, "denial", is not just a long river in North Africa.....
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Jimbo
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Sydneyite
14 Aug 2014, 12:43 PM
Who invents the technology?
Increasingly, they do.

But who benefits from the invention? A Scotsman invented the telly but Scotland isn't awash with telly factories.
zaph
14 Aug 2014, 11:53 AM
Unless we do things that the developing countries can't.
Like what?

We can only speak our own language and we have nothing like their work ethic.

Maybe we could give them drinking lessons or teach them how to skin up a joint.

Edited by Jimbo, 14 Aug 2014, 01:46 PM.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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herbie
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Sydneyite
14 Aug 2014, 12:43 PM
Who invents the technology?
If the developed nations were so jolly good at inventing new technology and flogging it at a profit, the politicians and bankers of those developed nations wouldn't have needed to invent new 'technologies' like borrowing up big to live beyond your means, repealing Glass-Steagall, and Derivatives. Nor would the central banks of those developed nations have needed to 'invent' ZIRP and QE in an attempt to keep the poo in the horse a bit longer.
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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