Justin Wolfers
Professor of economics and public policy at the University of Michigan, a non-resident senior fellow at the Brookings Institution, and author of a widely used i...
“If I were President Trump's chief economics propagandist, I would point out that since January 2025, wages have risen faster than prices. I wouldn't mention by how much, because the answer is almost not at all. But I would smile while I did it.”
Platypus Economics with Justin Wolfers · Money & Markets · November 2026
Context
The co-host had noted that wages have kept slightly ahead of prices since January 2025 but have lagged inflation over the past year. Wolfers uses the gap to show how the choice of start date changes the story told from the same data.
Transcript
…like, yeah, no, we're sure this is real. I think what we're going to say is, it looks like October was probably pretty good and the past few months were probably pretty good. And we're going to keep our eyes open for both confirmatory evidence or possibly hints that things aren't quite as strong.
…of two different stories here. Wages have sort of been keeping ahead of prices since January 2025, but over the past year, wages are up 3.1% and inflation is running at 3.7%. Should we think of workers as winning or losing here? Like, how do we understand the difference between those two numbers?
Yeah. So you've just done a really nice job there, Augusta, of showing some of the choices that you get to make when you present data, which is many things can be true at once, particularly with noisy numbers. So if I were President Trump's chief economics propagandist, I would point out that since January 2025, wages have risen faster than prices. I wouldn't mention by how much because the answer is almost not at all. But I would smile while I did it. And you could call me happy Justin. And that was just Happy Augusta, which makes everyone happy. It's also true that over the past year, wages have risen faster than prices. A deeper way of understanding this is to understand that neither is a series that moves particularly quickly. And so if you look at trends and tell two stories, what's going on with wages, what's going on with prices, you can sort of come to understand it. What's going on with wages? Over three or four years, wage growth has slowed down from 5% to 4% to 3%. Over the past few years, inflation has been high and…
You talked in the piece that you made about this about how workers that switch jobs tend to get higher wage rises than those who stay, who may be feeling inflation more. I have this instinct that's not based in data, that that creates that those incentives don't necessarily create a better economy…
yeah I think it's a really good question let me just point to something that's hanging over all of this conversation which is many workers are in jobs which they're not sure are going to be there in three or four years as the AI revolution continues so that gives you very very weak leverage if…
right
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