New data showing a slowdown in wage growth on Friday is leading to profit abound on the stock market
Compensation rose a measly 1.2 percent in the third quarter, even less than the 1.3 percent growth in the previous quarter, according to the data released Friday by the Labor Department.
Wage growth at an annualized rate for all workers fell by 0.2 percentage points to 5.1 percent from 5.3 percent between the second and third quarters, while private industry wage growth dropped by an even larger margin between the two quarters, to 5.2 percent from 5.7 percent. This is in contrast with the consumer price index, which sits at an annualized rate of 8.2 percent, resulting in an effective price cut.
The wage slowdown is a sign employers are paying less after the Federal Reserve’s series of interest rate hikes, and are being treated as good news by markets.
The Dow Jones Industrial Average of stocks gained nearly 600 points in early trading. The S&P 500 increased in value by nearly 1.5 percent, and the technology-heavy NASDAQ increased by 1.6 percent.
All that to say, as the entrenched wealth gets larger, you and I, the common person, are seeing an effective pay cut.
That is what Capitalism gives us, a system where the rich get richer, lavishing themselves in their entrenched wealth, while the common person struggles more and more each month.