Why wages can rise without sparking inflation

Why wages can rise without sparking inflation

There’s no doubt that US prices are rising and that the jobs market is tight.

Those are the two elements for a wage-price spiral; an environment where high prices lead to higher wages in a never-ending cycle that can only be broken by higher interest rates and a growth slowdown, if not a recession.

Yet Blackrock doesn’t think that is going to happen in this cycle because of high automation already in system and improving productivity. For instance, a steel mill that once faced rising wages would see margins impacted significantly. Now that industry is so automated that even a doubling […]

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