Federal Reserve Bank of Boston | bostonfed.org |
Bank Administration, 7 January 2020
Wage growth—a problem?
▶ Recent readings suggest wage growth of
about 3%, perhaps a bit above
▶ What should wage growth be?
▶ Productivity growth (1% or a bit higher),
plus
▶ Inflation (2%, or a bit below), plus
▶ Excess labor market pressure (?)
▶ So 3% is close to the benchmark
▶ Labor markets certainly appear to be tight
▶ One might expect wage growth to
increase somewhat in coming quarters
▶ We'll see
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