<http://www.federalreserve.gov/boarddocs/speeches/2002/20021219/>
>Another concern about deflation resides in labor markets. Some
>studies have suggested that nominal wages do not easily adjust
>downward. If lower price inflation is accompanied by lower average
>wage inflation, then the prevalence of nominal wages being
>constrained from falling could increase as price inflation moves
>toward or below zero. In these circumstances, the effective clearing
>of labor markets would be inhibited, with the consequence being
>higher rates of unemployment.