Unreal Wages

Unreal Wages
Many of the most persistently gloomy reports about the U.S. economy have long been based on the single most misleading statistic the government produces.

After reading the article, I can safely say that three of my previous posts need a lot of rework (Real Estate Debt vs. Wages, Debt vs. Wages, & Consumer Credit vs. Wages). I knew the data wasn't perfect and I was just ballparking it, but I was missing even more than I thought I was.

All such comments allude to "average earnings" of production workers in manufacturing and non-supervisory workers in services. But that data series does not purport to measure hourly pay at all, much less a typical worker's wage. The figures cover only 62 percent of all jobs, not 80 percent, if government workers and the self-employed were included. And that just begins to explain the confusion.

In fact, this data series is so misleading it is finally being phased out by the Bureau of Labor Statistics (BLS), to be replaced over the next four years by one that covers all private employees. For one thing, as the BLS explains: "the production and non-supervisory worker hours and payroll data have become increasingly difficult to collect, because these categorizations are not meaningful to survey respondents. Many survey respondents report that it is not possible to tabulate their payroll records based on the production/non-supervisory definitions."

What a convoluted mess.

When the average earnings series is at last given a well-earned burial, after suffering a lifetime of statistical abuse, what will all the gloomy worrywarts then find to write about?

Perhaps I'll have to change the name of my blog site to Illusionary Illusion of Prosperity, lol.

On the other hand, only a very tiny part of my bearishness relied on me accurately tracking wages. It does make me wonder what else I'm missing though. Next I'll be hearing that our trade deficit is a surplus and that our national debt is actually a national savings I suppose.