Downward Wage Pressure

Blogging for The Washington Post, Matt O'Brien looks at the two suggested causes for wage stagnation during our current economic recovery, he discounts one and endorses the second.

Between people who can't find the full-time jobs they want, people who haven't been able to find any jobs after looking for at least six months, and people who think things are so hopeless that they've given up looking for now, there are a lot more people than normal stuck on the margins of the labor force. And these "shadow unemployed," according to the Fed, exert just as much downward pressure on wages as the regular unemployed. Put it all together, and wages haven't recovered because the economy hasn't fully recovered.

That's true regardless of how often the Administration claims credit for a "wonderful" economic recovery that didn't happen.