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The content on this blog is my personal opinion and does not reflect the views of the Department of Defense or the US Navy in any way.


Thursday, August 16, 2018

Wages and Inflation

I can present all the data I want about how the growth in employee wages hasn't matched increases in productivity, point out how executive compensation has gone up far more than most employees' compensation, or so on... But sometimes a more evocative example is useful.

This Facebook post takes a McDonald's paycheck from 1974 (or so it appears to be, at least; I can't easily verify it), and compares the standards the worker earning it had to meet back then to what we expect our fast food workers to do today. Not content with that, we also look at how much this person would be earning if we adjust for inflation, and the differences in what we can buy today on a minimum wage compared to what was available for purchase in the past.

By any standard, we're paying less for more work compared to the past.

There are, of course, a lot of suggestions for what we should do to fix that. Most of the left is fairly devoted to raising minimum wages in order to fix it; while I largely don't have a problem with this, I can understand how that might have undesirable effects in some areas with a lower cost of living. Unfortunately, waiting for business owners to figure out that they're underpaying their workers doesn't seem like a particularly good solution either.

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