Searching for Higher Wages

Armona, Luis; Kapon, Samuel; Pilossoph, Laura; Topa, Giorgio; Şahin, Ayşegül

Discussion Paper

Searching for Higher Wages

Abstract: Since the peak of the recession, the unemployment rate has fallen by almost 5 percentage points, and observers continue to focus on whether and when this decline will lead to robust wage growth. Typically, in the wake of such a decline, real wages grow since there is more competition for workers among potential employers. While this relationship has historically been quite informative, real wage growth more recently has not been commensurate with observed declines in the unemployment rate.

Keywords: Labor Economics; Macroeconomics;

JEL Classification: E2; J00;