this post was submitted on 09 May 2024
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[–] Telodzrum@lemmy.world 64 points 2 years ago (13 children)

Real wages are up for three straight years; they were unmoved or negative for nearly four decades before that. Your feelings about the economy don't matter when the data all goes in the other direction

[–] PugJesus@kbin.social 70 points 2 years ago (15 children)

People are (sometimes willfully) confusing "the current status quo is fucked" with "there is no improvement resulting from the measures taken by the administration". The former is true - the latter is not.

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[–] partial_accumen@lemmy.world 30 points 2 years ago (3 children)

Your feelings about the economy don’t matter when the data all goes in the other direction

Except its not "all the data". Its "the data we've always used to measure this up to now".

The disconnect is that classic measurements of national economic health used to reflect the earning and spending power of average Americans. So using the same basket of measures and things that can affect those was a valid approach. In recent years those measurements don't reflect average Americans anymore. Inflation has eaten away at the value of savings impacting older Americans. High interest rates are now acting as a double whammy for young Americans that need borrow for higher education as well as first time home buyers, but the costs of both have risen sharply in the last 20 years. So while the high cost has been a problem, the now high interest rates are a force multiplier stepping on the necks of young Americans.

I don't disagree that Biden's actions have improved classic measurements. Those are still valid and useful for where they apply. I disagree that those measurements still reflect the experience of regular Americans. Thats a problem that extra economic measures should be included when looking at the experience of regular Americans.

[–] randomaside@lemmy.dbzer0.com 8 points 2 years ago

This. Buying power of the average American has decreased drastically. If you worked for the last five years and your pay has changed you've technically made less money every year as the power of the dollar has diminished. If you're on a fixed income it feels even worse.

[–] corsicanguppy@lemmy.ca 4 points 2 years ago (1 children)

Your feelings about the economy don’t matter when the data all goes in the other direction

Except its not "all the data". Its "the data we've always used to measure this up to now".

I hear you saying an apples-to-apples comparison to show a point is ... somehow bad.

Sometimes I just don't know what people want.

[–] partial_accumen@lemmy.world 4 points 2 years ago

I hear you saying an apples-to-apples comparison to show a point is … somehow bad.

You're gonna have to grow out of just thinking there are only two outcomes: "good" and "bad". The world is more complicated than that. The classic indicators don't reflect the modern average American experience anymore. They were chosen in a different time under different circumstances. They were chosen when a college education cost a couple of thousand dollars a year, a average blue color worker could buy a brand new car every two years, and a small house was easily affordable for a single income earner with the other staying at home raising kids. Clearly you can see how this is now out-of-date with modern American life.

They're fine as a useful apples-to-apples comparison to national economic health, but today fail to show what average Americans experience.

Sometimes I just don’t know what people want.

Introduce some nuance into your worldview and that may help you understand.

[–] AA5B@lemmy.world 4 points 2 years ago (1 children)
[–] NightAuthor@lemmy.world 5 points 2 years ago

There are plenty of problems with CPI, one of which is the very issue of “feelings”. Owners equivalent rent is absolutely irrelevant to actual rent costs. It’s just how much a homeowner says they would charge if they were to rent out their place. These are not the people renting out units…they’re just someone who happened to have enough money to buy a house. WTF do they know.

[–] underwire212@lemm.ee 22 points 2 years ago (1 children)

Peasants, We have increased your daily crumb rations by 1.2%. Be grateful for that.

[–] Wiz@midwest.social 1 points 2 years ago

However, we are reducing the size of crumbs by 7%

[–] vladmech@lemmy.world 21 points 2 years ago (5 children)

Are they? I got a 3% ‘raise’ again this year and that doesn’t seem like it’s keeping up with inflation. And yes yes get a different job, blah blah.

[–] Aceticon@lemmy.world 9 points 2 years ago* (last edited 2 years ago)

Two things:

  • Judging by the increase in prices reported by many as well as shrinkflation, Official Inflation Figures in the US might be very understated, which would make that "real" part of real wage rise be complete total bollocks, since a wage adjusted to a smaller inflation index value than reality is not in fact "real". Considering that understating Official Inflation not only helps in political propaganda like the "real wages" one but also mathematically feeds to a higher GDP Growth figure (in simple terms: the unaccounted for inflation appear as "growth") which is also heavilly featured in political propaganda, it's pretty naive to think that there isn't political pressure to "adjust" that figure down, especially in an election year.
  • Independently of that, it's perfectly possible for the average real wage (which is what's reported) to be going up whilst the median real wage (which is more representative of most people's experience and is not what's reported) to be stagnant or even falling: all it takes is for the top earners to be getting significant raises to pull the average up enough that it disguises everybody else not getting such raises.

PS: To add to my second point, here's an interesting chart. Even though it's an overall unweighted nominal (so, not real) value and it's a 3 month moving average (so the effects are shown delayed) you can see a spike and subsequent fall towards the trend in 2023. Now look at this inflation chart and you can see that the median salary growth is delayed from inflation and never actually managed to be as high as the actual inflation. This actually brings up a 3rd point I hadn't considered:

  • The salary growth is delayed from inflation, so what we saw in 2023 (and which is now slowing down as per the first chart) is salaries trying to catch up with the high inflation of 2021/22 (and failing) but the inflation by then was already much lower. Obviously if one completelly ignores the last 5 years (which is a common technique in political propaganda) and just calculates "real" wage growth from present day wages and present day inflation, the result will be positive, simply because salaries are still trying to catch up to the inflation of 2-3 years before. However if one adds up the median real wage growth of the last 4 years, the picture is significantly worse.
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[–] AA5B@lemmy.world 14 points 2 years ago

This is all about the disconnect between feelings and actual data. The question is how to get them back in sync. Some of that is time, but people will feel negatively as long as their media keeps telling them they are worse off.

For me it’s time. I know that be all objective measures I’m better off. It’s not just the overall stats but I got decent raises two years in a row. I still get hit with how bad inflation is. But a big part is that I stopped buying stuff for a couple of years. I cut back to really only make necessary purchases. Now that I have a little more available resources, and can make a few discretionary purchases, I’m hit by the last 4-5 years of inflation since I even looked. My comparison point is pre-COVID

[–] Bakkoda@sh.itjust.works 13 points 2 years ago

Your statements about it matter as much as his opinion without sources. Not disagreeing or agreeing, just seeing two opinions and no facts.

[–] TheDemonBuer@lemmy.world 11 points 2 years ago* (last edited 2 years ago) (3 children)

But I think you can understand why three years of improvement after four decades of stagnation might not dramatically move peoples' perception of the economy. Plus, are real wages up for everyone? Is it average real wages? Median? There's a big difference. It's entirely possible some people are experiencing much more real wage growth than others.

Edit: apparently a lot of you are confused. You seem to think that if wages are up for some, they must be up for all. That's not how it works. Not everyone got a raise over the last three years. Some people did, others didn't. Some people saw their income increase dramatically, some saw their income stay about the same, and some saw their income go down. And that's true whether the incomes in question are measured in "real" (inflation adjusted) terms or are nominal figures.

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[–] Lucidlethargy@sh.itjust.works 10 points 2 years ago (1 children)

Serious question: are they up higher than inflation if you adjust for the last three years?

[–] iopq@lemmy.world 22 points 2 years ago (1 children)

Yes, that's what real wages mean, adjusted for inflation

[–] EatATaco@lemm.ee 6 points 2 years ago

Wage growth now is outpacing inflation, meaning we're going in the right direction. But if you compare over a few years, many people have fallen behind and have a lot of catching up to do.

[–] DragonTypeWyvern@literature.cafe 7 points 2 years ago (1 children)

Lol

Look, peasants, wages have gone up by slightly less than 1% for reasons having nothing to do with the government, be grateful!

[–] iopq@lemmy.world 6 points 2 years ago

They went down in the 1970s and 1980s, and stagnated in 2000s, the last decade of growth hasn't been seen since the 1990s

[–] Fredselfish@lemmy.world 7 points 2 years ago (5 children)

My wage has not budged in four fucking years and no wages in Oklahoma have gone up if anything they going down.

My company will not give raises and I get paid more than any other person in my field and it isn't enough.

They literally offering jobs here at 12 an hour you be lucky to see 15 with bunch bullshit stipulations.

[–] Wiz@midwest.social 8 points 2 years ago

I'm sorry that some states are shitholes, with shitty people trying to make them shittier. I live in one too.

Low taxes, but low benefits to its citizens, so people don't really want to live there. Poor healthcare, poor education, fewer opportunities for the arts and the things that make life worth livin'. It's a cycle of poverty and despair, and it's awful.

When I get money, I'm moving out. But I may never have enough money.

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[–] n2burns@lemmy.ca 6 points 2 years ago (1 children)

I definitely agree with you about the data, but people's feelings do matter, that's why we're currently experiencing a vibecession.

[–] iopq@lemmy.world 11 points 2 years ago* (last edited 2 years ago) (2 children)

Why would people's feelings matter when the economy is actually good? The vibecession is literally a Conservative psyop

[–] ShepherdPie@midwest.social 5 points 2 years ago (1 children)

The entire stock market is based off investor's feelings so why shouldn't that also apply to the rest of the economy when market performance is a primary data point when measuring how the economy is doing?

[–] iopq@lemmy.world 2 points 2 years ago

Why isn't the stock market down

[–] n2burns@lemmy.ca 4 points 2 years ago (1 children)

People's feelings affect how they act. Those actions, collectively, can have an impact on the economy (recession spending can cause a recession), politics (especially with elections in 6 months), and society in general. As they say, "perception creates reality."

[–] iopq@lemmy.world 1 points 2 years ago

Why aren't people saving up for a recession? They are spending at a very healthy level

[–] rusticus@lemm.ee 3 points 2 years ago (4 children)

Consumer and credit card debt would like a word.

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