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Wage Growth after the Great Recession

Author

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  • Roberto Pinheiro
  • Meifeng Yang

Abstract

Nominal wage growth since the Great Recession has been sluggish. We show that the sluggishness is due mostly to weak growth in labor productivity, as well as lower-than-expected inflation. We also find that wage growth since late 2014 has actually been above what would be consistent with realized labor-productivity growth and inflation, and this trend in wages reflects an increase in labor?s share of income. We show evidence that this increase in the labor share may be due to a reversal of the trend to replace labor with capital.

Suggested Citation

  • Roberto Pinheiro & Meifeng Yang, 2017. "Wage Growth after the Great Recession," Economic Commentary, Federal Reserve Bank of Cleveland, issue March.
    • Handle: RePEc:fip:fedcec:00065
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    Cited by:

    1. Guyonne Kalb & Jordy Meekes, 2021. "Wage Growth Distribution and Changes over Time: 2001–2018," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 54(1), pages 76-93, March.
    2. Guyonne Kalb & Jordy Meekes, 2019. "Wage Growth Distribution and Decline among Individuals: 2001-2017," RBA Annual Conference Papers acp2019-03, Reserve Bank of Australia, revised Jul 2019.

    More about this item

    Keywords

    Labor; Wage growth; Productivity;
    All these keywords.

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