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Federal Reserve Bank of Kansas City
Macro Bulletin
Why Is Wage Growth So Low?
Jun Nie
Abstract

Real wage growth has been low in recent years despite continued improvement in the labor market. I examine the interaction between productivity growth and unemployment and show that low productivity growth largely accounts for the current low wage growth. If productivity growth were to pick up, the current low unemployment rate would likely strengthen the positive relationship between productivity growth and wage growth.


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Jun Nie, "Why Is Wage Growth So Low?" , Federal Reserve Bank of Kansas City, Macro Bulletin, pages 1-4, number 00072, Dec 21 2018.
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Keywords: Productivity growth; Unemployment
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