While most of the economic focus today is on March’s tepid job growth and the unemployment rate, incomes may well play a bigger political role than jobs in 2012. And the numbers today didn’t look too hot. Wages are going the wrong direction. The Center for Economic and Policy Research:
One very discouraging item in the survey was a 0.1 hour drop in the length of the average workweek. While the data are erratic, the drop was driven largely by a decline of 0.3 hours in nondurable manufacturing, a sector where hours tend to be better measured. Wages continue to go nowhere. The average hourly wage has increased at just a 1.85 percent annual rate over the last quarter, which likely puts it behind inflation. The wage for production, non-supervisory workers, which better tracks the median wage, increased at just a 1.37 percent annual rate over this period.
Few economists think the economy will grow much more than 2.0% to 2.5% this year. That is a recipe for more wage stagnation — at best — and perhaps a tough time for Team Obama this fall. (Below chart via Strategas Research.)