A Presidential election year will bring with it plenty of good, bad, and ugly policy ideas to help struggling families. With the unemployment rate extremely low, much focus will be on real wage growth for workers. This is not currently disastrous – real wages are growing at around 1.4 percent per year (see Chart below). But after 15 years of relatively sluggish performance in GDP per capita growth, politicians will be trying to think of ways to broadly raise living standards further.
Over time, living standards are driven in large-part by rising wages, in turn driven by the rising productivity of workers. But in an excellent Bloomberg article this week, Tyler Cowen points out that many of the forces that determine workers’ wages are structural, global, and difficult for policymakers toRead More »