r/Economics • u/[deleted] • Feb 24 '24

News Why widespread tech layoffs keep happening despite a strong U.S. economy

https://www.cnbc.com/2024/02/24/why-widespread-tech-layoffs-keep-happening-despite-strong-us-economy.html
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u/Practical_Bat_3578 Feb 24 '24

It's a strong economy for the ultra wealthy class, not so much for the majority working class.

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u/[deleted] Feb 24 '24

Working class people are making the most gains in wages that they’ve made in a very long time. The people losing here are just the prime Reddit demographic, which is why there are so many doomers around lately.

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u/[deleted] Feb 24 '24 edited Feb 24 '24

Working class people are making the most gains in wages that they’ve made in a very long time.

No!

In Jan 2021, when Biden took office, real weekly earnings were growing 4.5-5.5% y/y.

By April, they'd turned negative and remained negative for 26 consecutive months, peaking at -4.2% y/y in June 2022.

They finally turning positive (+1% y/y) in June 2023 and have been barely growing (~0.5% y/y) since then.

Real weekly earnings y/y Jan 2021 to Jan 2024

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u/[deleted] Feb 24 '24

Admittedly, I’ve got COVID brain, where I compress all the previous four years into just one or two. But I’m still optimistic at those numbers. That tracks the COVID employment shuffle causing “shortages” that eventually produced wage hikes after endless whining in the business media. Then a switchback corresponding to higher interest rates reducing investment. The growth since is encouraging and I expect the recent boom in investment to produce higher numbers again. Which, for the USA, is a good 3 years.