The American economy has just achieved a very positive record, in a way that workers can appreciate. Average hourly earnings by production and non-supervisory employees, when adjusted for CPI inflation and underemployment, have achieved their highest level since records began to be kept in 1964. The level is $21.67 as of 2019Q2.
(As usual on our blog, we estimate underemployment, the U6 rate, to be twice the standard U3 unemployment rate. The ratio of U6 to U3 has stayed between 1.8 and 2.0 since 2012.)
(As usual on our blog, we estimate underemployment, the U6 rate, to be twice the standard U3 unemployment rate. The ratio of U6 to U3 has stayed between 1.8 and 2.0 since 2012.)
A negative metric on the economy is at low levels not seen in 63 years. Our misery index is the sum of CPI inflation plus underemployment, as defined above (the U6 rate approximated by twice the U3 rate). The level as of 2019Q2 is 9.1%. The last time this misery index was lower was 1956Q1.
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