The shrinking role of unions helps shed light on an economic trend that is puzzling Fed officials

pulse

December 13, 2017 6:02 PM

ANALYSIS: Federal Reserve officials who have expressed beffudlement at the absence of wage growth in spite of a 17-year low jobless rate should take a closer look at the issue of union membership.

A decline in union membership and activism helps explain why US inflation and wages have remained subdued despite a prolonged economic recovery.
Low inflation gives the Federal Reserve room to keep interest rates low for longer, particularly if it wants to see workers' wages rise.
US inflation has undershot the Fed's 2% target for 100 of the 104 months since the start of the financial crisis, according to Capital Economics.

pulse

Enhance Your Pulse News Experience!

Get rewards worth up to $20 when selected to participate in our exclusive focus group. Your input will help us to make informed decisions that align with your needs and preferences.

I've got feedback!

JOIN OUR PULSE COMMUNITY!

Unblock notifications in browser settings.

Eyewitness? Submit your stories now via social or:

Email: eyewitness@pulse.ng