Numerous callers over the past few weeks mentioned that age increases are not really keeping pace with inflation. This is something mentioned significantly at the national level too. As a result I used the CPI to adjust the wage data from the post last (found here) week about wage comparisons to get a sense of the curve shapes after the adjustment. I put them all in terms of 200Q4 level. The adjustment is the same for the different regions so there is not added value in the comparison of the different regions really, it is more the comparison of the nominal and real values.

So first the graph of wages in goods producing industries from last week.

Now we follow up with the same series adjusted for inflation.

As you can tell from the y-axis scale the real value of wages is lower and the slope of the Cass and Grand Forks curves are flatter as a result of the adjustment. The same type of comparison holds true for the service providing industries too.

The graph from last week:

Then the adjusted graph:

The most noticeable change, at least to my eye is the change in the slope of the Cass and Grand Forks series. Now these graphs are not the easiest to notice the adjustment so I created one other for Grand Forks, just looking at the average weekly wages in goods producing industries in both real and nominal terms.

This makes it a bit more noticeable that real wages are certainly growing, but not by as much as the nominal level would seem to indicate. The nominal weekly wage increased by 109% from the beginning to the end of the time period, and the real wage only by 49.4%. By the way we can see a similar pattern in data outside of North Dakota, as the Hennepin County graph below would indicate.

Taking a close look at the graph would indicate that the growth in Grand Forks county in both real and nominal wages is higher than in Hennepin county, but the level is higher in Hennepin County. Wage levels are that first indicator to lots of job seekers. 

The other item I did not adjust for here is the cost of living type aspects mentioned by many of the callers as well. There are a few reasons for this. There are lots of different aspects to the cost of living, and over time tastes and preferences change which also then change the basis for comparison. As a result I am not sure how much meaningful comparison can be had beyond the adjustment for inflation really. 

Now I know many texts, calls, and emails suggest that firms do not believe wages are the biggest issue.  For any given business it may not be a factor and I conceded that point many times. However, on average, if you are looking at persistent labor shortages and do not notice wage responses then you are clearly leaving an important solution on the sideline.