For years after the 2008 financial crisis, growth in average hourly earnings stayed low, hovering at around 2% year over year.
This was most likely not high enough to support the Fed’s stated inflation target of 2% year-over-year.
However, 2016 has seen wages growing at a somewhat faster rate, with average hourly earnings growing in a range of 2.2% to 2.6% year-over-year, and hitting a post-recession high of 2.8% in October, before missing expectations and coming in at 2.5% in November.
According to the December jobs report, average hourly earnings grew by 2.9%, a new post-crisis high and slightly beating the Bloomberg economists’ consensus expectation of 2.8%.
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