These are just a small selection of the countless repetitions used by news outlets across the country: Wages aren’t growing. The popular narrative implies that worker paychecks – and by extension, employer payrolls – have been unchanged since at least the Great Recession, if not for decades prior. While the economy has improved and most major metro areas are seeing unemployment plummet, the common consensus seems to be that the average American worker has not felt the benefit of this in their paycheck. The concept of wage stagnation has become a politically popular mantra representing the theory of the fall of the middle class.
Statements from the press and politicians contrast sharply with the reality facing employers and employees. Ask any employer who’s been hiring lately, and they’ll tell you that it costs more to fill a skilled position this year than it did last year, and especially the year before that. For a company looking to hire and/or retain quality workers, believing the wage stagnation narrative has the potential to be very costly. What’s the cause for this disconnect between this popular position and the data behind the headlines?