Retail Sales, Wages, Inventories, and The Growth Illusion

Labor shortages are supposed to be boom times for workers. When businesses have to compete to hire and retain employees, they bid up wages and improve working conditions.      September 16, 2021 advertisement   Crypto Expert: This is only the beginning- What You Need to Know Right Now

Today's Top Stories From the Breitbart News Desk Labor shortages are supposed to be boom times for workers. When businesses have to compete to hire and retain employees, they bid up wages and improve working conditions. Yet many American workers feel like they are falling behind. Let's run through some facts. Many businesses say they are having trouble finding workers. In the Philly Fed August survey of manufacturers, 74.4 percent of firms cited the labor shortage as holding back their production, second only to supply chain disruptions. And businesses are raising wages. Compared with a year earlier, the average hourly wage was up 4.3 percent in August. The reason this doesn't feel like a winning time is that the economy is experiencing the highest rate of inflation in over a decade. Adjusted for inflation, average hourly wages are down nine-tenths of a percentage point. Average weekly wages are down by the same amount. College-educated workers have seen a 1.1 percent decline in real wages. Prior to the pandemic, hourly workers were seeing a 1.8 percent annual gain, and college-educated workers were seeing a 1.6 percent gain. A similar dynamic can be seen in economic data released Thursday. The 0.7 percent monthly gain in retail sales falls to 0.4 percent adjusted for inflation. Inventory growth of 0.5 percent falls to 0.2 percent adjusted by the Consumer Price Index. But the CPI is probably not the right measure to adjust business inventories. If we use the Producer Price Index for intermediate demand, a measure of what businesses paid for goods, then it looks as if inventories contracted. After years of low inflation, analysts appear to have gotten out of the habit of differentiating between nominal and real gains. For a decade or so, they tended to be not much different from each other. But in the current environment, looking at the nominal numbers only can be misleading. The inflation-adjusted numbers tell us wages are falling, inventories are shrinking, and retail sales are sluggish. No wonder consumer sentiment—and Biden's approval rating—have fallen so far. – Alex Marlow & John Carney Breitbart News Network

TOP STORY

Inventory Growth Slows as Businesses Struggle with Supply Chains and Inflation

The pace of inventory accumulation by U.S. businesses slowed in July but the extent of the slump was partially hidden by high inflation. Business inventories rose 0.5 percent following a 0.9 percent increase in June, the Commerce Department said on Thursday. Inventories are a key part of the calculation of gross domestic product. And inventory growth is often a signal of rising business confidence and a growing economy. [Click here for more]

IN OTHER STORIES...

Inflation Near Record in Biden's Backyard

Price increases remain widespread in the U.S. mid-Atlantic region, a survey conducted by the Federal Reserve Bank of Philadelphia showed on Thursday. The Philadelphia Fed said that manufacturers continued to raise prices on products and faced higher prices on materials in September, although this impact had somewhat narrowed from the... [Click here for more]

FTC: The Big Tech Masters of the Universe Exploit 'Loopholes' to Avoid Merger Reviews

The FTC has alleged that hundreds of deals made by tech giants like Facebook and Google were not reviewed by merger watchdogs, fueling the companies' unchecked growth. Events like gaining voting control of rivals, buying patents, and outright buyouts of small tech companies are a key part of the arsenal used by the largest Big Tech companies to maintain their stranglehold over the internet. Bloomberg reports that according to a recent Federal Trade Commission study, hundreds of deals made by U.S. tech giants were not reviewed by merger watchdogs, adding to the unchecked... [Click here for more]

Commerce Secretary Raimondo: Vaccine Mandate 'the Single Best Thing We Can Do' to Help Restaurants, Hotels

Commerce Secretary Gina Raimondo, on Thursday's broadcast of "CNN Newsroom," touted the vaccine mandate for companies recently announced by President Joe Biden. Raimondo pushed back against the notion that the mandate would hurt the food and hospitality industry recover from the shutdowns. She said it is actually "the single best thing that we can do" to... [Click here for more]

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