The Democrats finally get it: It's the wages, stupid

Liberal policy-makers are starting to turn economic populism into policy

(Image credit: (Marie Bertrand/Corbis))

Now that the American jobs machine has finally hit second gear, economic commentators are starting to focus on wages more than headline jobs numbers. Despite the fact that 2014 was the best year for job creation since 1999, wages barely budged — indeed, they actually experienced a monthly decline last December.

Wages are a good thing to focus on. But while some wage gains may be made as the economy slowly heats up, there is no reason to expect that long-term wage stagnation will be lifted by the invisible hand of labor markets alone, as Mark Thoma argues. Wages as a share of the economy have been falling for over 40 years, and it would be impossible to run a hot economy for the length of time needed to reverse the trend.

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Ryan Cooper

Ryan Cooper is a national correspondent at TheWeek.com. His work has appeared in the Washington Monthly, The New Republic, and the Washington Post.