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Target CEO says shoppers are pulling back, even on groceries
(www.cnbc.com)
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this post was submitted on 03 Nov 2023
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It’s almost like people don’t have enough money to buy things when wages are stagnating and prices are going up. Weird.
This was true May 2021 - Jan 2023 but has flipped since luckily.
https://www.statista.com/statistics/1351276/wage-growth-vs-inflation-us/
Unfortunately though there's been long periods like the 2000's where wgae growth vs inflation barely budged, though they did start going up in the 2010's again. Real wages are still catching up to where they were in the like 1970s though. 1980s were not kind to real wages (wage vs inflation).
It's funny how much people here hate hearing this. Any time you point out this fact, it's down voted.
Because it's misleading at best. If you and I were racing and I moved at twice your speed for four hours it would be misleading to say you were outpacing me when you start moving faster than me for four minutes. Just because you are now faster than me you are still very far behind and therefore it makes no material difference how fast you are currently moving. American workers are still in a hole caused by stagnant wages and corporate price gouging that's lasted for decades.
I don't think it was misleading, I think people didn't read the whole comment. I said the trend reversed but we haven't even caught back up to where we were in the 1970s. It's going to take more than just one year of real wage growth to make up for stagnation and loss over decades. Wage growth is outpacing inflation for the moment, but this was just a recent change.
And likely temporary. I talked to my boss about our expected merit increase (stupid name, it's just the inflation increase) and he said to not expect as much as last year, which was also below inflation. We source our numbers from the rest of the market and target something like 65-75 percentile (higher than average, but not top of market).
Last year we got ~5.5%, and this year will probably be a little lower (like 4-5% maybe).
You can't catch up if you never out pace them, so of course it's important and not misleading. You don't think they talk about teams coming back from being down early on?
But more importantly, the claim that wages are stagnant is not just misleading, but outright wrong, and it was corrected. Why aren't you calling out the actual false statement rather than claiming reality is misleading?
People are still buying cars and luxury goods though. This reads almost as a story of how our society is fracturing.
People cannot afford groceries or basics, but the new iPhone seems to sell pretty well.
It has titanium! How could not want to buy that! How innovative! It's a completely different experience in your hand, you've tried metal, plastic, even glass, but not... Titanium... So cool...
I worked in China for a couple years on a banking app for lending money. The middle class in large cities over there was interested only in social status. They would happily borrow insane amounts for the newest phones and biggest cars, when they couldn't afford a dinner for their kids. I know that what we did was predatory and exploitative, and on a scale unimaginable on European markets. Our marketing predicted a collapse of the target social class in 5-7 years... That was 4 years ago.
I'm certain other (western) markets experience similar progression - and exploits.
That's terrifying.
Tbf, without good public transport, many places in the US iirc, require good quality cars.
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That's not true anymore. Looks like salaries are keeping up with inflation:
https://www.bankrate.com/banking/federal-reserve/wage-to-inflation-index/
Did you even read the article? The gap between inflation and wage increase is closing, but inflation is still higher.
And that's irrelevant because we have 25 years of decreasing wages to make up for.
From the article:
"Pay is beginning to catch up in the race, and since May, has been rising faster than inflation after losing ground for more than two years."
Basically what they are saying is that it's behind overall, because it lagged so much due to COVID, but that salary growth is actually faster than inflation right now.
Looks like you didn't read the article:
You and the person who also claimed the comment youre replying to was wrong cannot read. Whether wages are rising faster than inflation is irrelevant when we are years and years behind. All that means is that we are on an uphill trajectory.
If you have 20 apples to start, and you have to pay me 1/3 apple per month. You make 2 apples per month. Over a year I raise that tax to 1+1/3 apples.
If over the next year, I raise your apple income by 2/3 of an apple and your apple tax by 1/3, your earnings increase outpaces the increase of my apple tax, but you're still completely fucked.
It's not the same as saying everything is hunky dory, but of course wages growth now beating inflation is relevant in a discussion about the relationship between wages and inflation, and especially when someone makes the incorrect claim that it's the other way around.
You can never not be behind if wages never outpacing inflation, so the fact that it's catching up is important.
Yes. You're still not getting it though.
The rate in which pay is increasing is higher than the rate at which inflation is increasing. That is correct. But if you look at the numbers, total inflation in 2023 is still higher then total pay increase in 2023.
You are conflating a rate increase with a total increase. That is not accurate.