Why aren't wages rising?

When President Obama delivers a speech about the economy, he never utters a "sound bite that declares America's storms have passed," said Alexis Simendinger at Real Clear Politics. He knows that plenty of Americans still feel uncertain about their jobs and fearful for their future. But last week, with good economic news breathing wind into his sails, the president seemed to say, "Snap out of it." In his most substantive domestic policy speech in months, Obama insisted that despite the long slog from the financial crisis, economic indicators are undeniably brightening. The unemployment rate in September dropped to 5.9 percent, the lowest level since July 2008, and businesses have created 10 million jobs in the past five years. "Inch by inch," the recovery is taking hold.

Try telling that to the suffering middle class, said The Wall Street Journal in an editorial. Wages have utterly stagnated under Obama's watch. U.S. median household income remains 3.9 percent lower than it was when the recession ended in 2009 — and almost 8 percent lower than in 2007. While wages have lately begun to show some growth, the gains have been "slow" and "uneven," concentrated largely in metropolitan areas. For all of Obama's stimulus spending, tax increases, and efforts to raise the minimum wage, incomes didn't budge at all in 36 states last year. Not that you'll hear that in any of his stump speeches. "Perhaps it is too embarrassing to point out that the policies flaunted to reduce inequality have presided over so much more of it."

Cut Obama a break, said Jonathan Bernstein at Bloomberg View. This administration "inherited an economy in a deep recession," and in the years since, "unemployment has eased, manufacturing has picked up, and corporate America appears to be unusually healthy." Yet you can't deny that the lack of wage growth remains a real puzzle, said Justin Wolfers at The New York Times. Hourly wages have grown a meager 2 percent in the last year, not much faster than inflation. Falling unemployment typically leads to faster income growth, but that relationship appears to have broken down since the Great Recession. If that's the case, unemployment might not be so useful for measuring the health of the economy. We might be better off looking at wages, and the fact that we're not seeing impressive growth suggests "the expansion has still got quite a way to run."

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Which means "Americans might be on the verge of getting a long-awaited raise after all," said Catherine Rampell at The Washington Post. Many employers have gotten "spoiled" in the years since the recession ended, expecting to get away with "bargain-basement deals" on salaries. But as the economy improves, workers who have been "desperate to find something, anything, to pay the bills" will become more discerning, and bosses will be forced to cough up more dough to fill vacancies. Already, "the share of businesses saying they expect to increase compensation in the coming months is finally creeping up." For the sake of all our pocketbooks, "let's hope they're right."