The Role of Wages in US Inflation: Debunking the Myths.

Rising wages due to a worker shortage have been a key driver of inflation, leading to record job openings and high turnover. However, there are signs that wage growth is cooling, especially as layoffs have skyrocketed nearly fivefold in 2023 across some industries. While central banks are still cautioning about the wage-price spiral, experts seem more optimistic that the wage-induced inflation loop won't be as big of a threat as first expected.