report on real earnings and wages.
The results were not definitive of anything—but they weren’t encouraging: Real wages (adjusted) dropped 0.1% in January, but for the year, real wages rose 0.2% year-to-year (January 2010 to January 2011). Which means, of course, that this past January represented a significant downturn in real wages.
Was it a blip? Or was it the start of a trend?
Forgotten among the discussions about inflation are wages and salaries: If wages and salaries are downturning, even as price levels are upturning, then inflation is taking a double-bite from the average worker.
So keep an eye on real wages in February and especially March: If this past January’s trend continues, then people are going to be hurting even more than the inflation number would lead one to believe.