Krugman on today's worker wage statistics: "Are wages really surging?"

[swag]

http://krugman.page.nytimes.com/b/a/257993.htm

Sept. 6, 2006
Compensation Statistics: A Note From Paul Krugman

excerpts:

. . .

A quick wonkish note, for readers with an interest in the gritty details of economic numerology: today (Wednesday, Sept. 6) the Labor Department released revised estimates on compensation. And these numbers seem to show a wage explosion: the rate of increase in unit labor costs labor costs minus productivity growth is at its highest level in 16 years.

So, are workers making out like bandits? Don't be surprised if you start seeing opinion pieces claiming that they are.

But here's the thing: We have evidence from three different sources that tells a very different story. First, wages of non-supervisory workers, as measured by the Employment Survey, a survey of employers, are lagging slightly behind inflation. Second, median weekly wages, as measured by the Household Survey, a survey of (duh!) households, are lagging well behind inflation. Third, profits, as measured by the Bureau of Economic Analysis, are growing much faster than G.D.P., which has to mean that labor costs are growing slowly.

Oh, and one more piece of evidence: polls showing that people are unhappy with the state of the economy suggest that most people can't be seeing big wage gains.

So what's going on? The best guess is that something is wrong with the numbers. Dean Baker, of the Center for Economic Policy Research, suggests that some capital gains, such as income from cashing in stock options, may be erroneously showing up as wage income.

. . .

[LaPera]

1. Krugman is right on the "money" as always!

[Richard Steele]

2. We all know damn well that WORKERS wages are declining.

[bhikkhu]

3. "some capital gains...may be erroneously showing up as wage"s

surely a simple and unintentional mistake...