>[From Dean Baker, CEPR. Correct? --CGE]
>
>While the April figure shows a respectable gain, the average hourly wage
>has risen at just a 2.1 percent annual rate over the last three months,
>well below the rate of inflation. The lowest paid segments of the labor
>force continue to be hit hardest. Over the last year, the wage gains in
>retail trade and leisure services have averaged 1.8 percent and 1.7
>percent, respectively ... With higher interest rates likely to slow the
>housing sector, a new source of demand will be badly needed.
I just read Dean's piece, and it looks like he took a magnifying glass to the report looking for blemishes. There were very few, almost none in fact. Wage gains, which had been slowing in late 2003/early 2004, picked up.
Long-term factoid worth considering: average service wages are now 94% of average manufacturing wages. Ten years ago, the ratio was 90%; twenty years ago, 87%. It may be time to junk the cliche that factory work = high wage and service work = low wage.
Doug