Although wages continue to rise, some economists worry that this is not enough to exceed inflation.
As the economy continues to slowly recover from the COVID-19 pandemic, inflation is also increasing, commodity prices are rising across the board, and food, housing, rent, and natural gas prices are expected to see more increases.
However, due to labor shortages, employers also provide incentives, such as raising wages to attract workers to enter, CNBC reportNonetheless, economists worry that rising wages will prompt companies to also raise prices, thereby exacerbating inflation concerns.
An example of fear that prices will rise if wages increase comes from Chipotle, which announced that it would Increase menu price Up to 4% to offset their cost of raising the minimum wage of workers to $15 per hour.
David Weliver, founder of the personal finance website Money Under 30, said that average hourly income increased by 3.6% year-on-year, but these incremental increases are “unlikely to keep up with the rising cost of living.”
However, President Biden stated that he believes that wage increases should not lead to price increases, and that there is enough room to increase workers’ wages without raising consumer commodity prices.
These concerns are also accompanied by greater efforts to raise the minimum wage to $15 an hour, according to Pew Research Center, Two-thirds of Americans support.
Timm Von Watcher, professor of economics at the University of California, Los Angeles and director of the California Policy Laboratory, said: “The benefits of reducing inequality-making people have money in their pockets and stimulating the market have been fully demonstrated. ” National Broadcasting Corporation.
“The best evidence is that it makes sense to set minimum wages wisely. They increase incomes, reduce individual and family poverty, and have no measurable negative impact on employment,” MIT Professor of Economics and MIT Said David Otell, co-chair of the college’s future work task force.
NBC Finance Channel The June report stated that the inflation rate is expected to reach 4% in 2022, a record high in one year. The Federal Reserve Bank of New York also predicts that it will reach 3.6% in 2024, the highest level since August 2013.
Photo: AFP/Daniel SLIM
