2019 ROI First Quarter Edition 2019 - HIS Capital Group | Page 31

Having mentioned that wage growth might explain some of the consumption ho-hummness, here’s a look at
two wage measures that suggest that wages might be the explanatory variable. At this stage in the economy
cycle, wage growth would be above 4%. Instead, wage growth is still struggling to get to 3.5%. Globalization
and the development of the freelance workforce probably have something to do with this.
The wages divided by GDP picture probably ought to make you pause. The measure is at close to its all-time low
of 42%. Although employment and the overall economy is in good shape, wages have lagged. Hmm.
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