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Experts Warn U.S. Economy is at Risk of Wage-Price Spiral

February 09, 2022

With more than 60 percent of Main Street businesses reporting they were forced to raise their prices to keep up with inflation, which has reached the highest rate since 1982, economists are warning the U.S. is at risk of a wage-price spiral.

As reported by Epoch Times:

“Wages among hourly workers in the United States rose above expectations in January, putting economists on alert for the stirrings of a possible wage-price spiral as concerns about the persistence of underlying inflationary pressures shift from supply-side bottlenecks to worker demands for higher pay.”

Democrats ignore how the last three years of wage gains for families have been wiped out by price increases. Typical families have had to pay more for the same goods they purchased in previous years because of Bidenflation–yet President Biden ignores these price increases while boasting of higher wage gains.

That’s the definition of a wage-price spiral. Families’ paychecks falling further behind for the foreseeable future.

So much for “transitory” inflation.

WATCH: Brady: We Have the Makings of a Wage-Price Spiral That Is Very Tough To Tame

Here’s what the experts are saying:

Former Obama-Biden Treasury Secretary Larry Summers:

“Stories like this, plus AHE (Average Hourly Earnings) rising at 9 percent annualized last month, plus core ECI up nearly 6 and rising, plus super tight labor markets, says wage/price spiral to me. Not sure I understand contrary theories.”

READ: Analysis: Typical family pays $5,000 for Bidenflation tax; minorities, young adults, middle class hit hardest

READ: American Workers Are Stretching Dollars To Keep Up With Bidenflation

National Federation of Independent Business:

“Compensation was also raising a red flag, reaching 48-year record high reports of increased labor compensation. Reports of price increases closely tracked reports of higher compensation, hinting at a wage price spiral.”

READ: Bidenflation Forced Small Businesses to Raise Prices to Keep Up

Economist Christophe Barraud:

“Average hourly earnings for production and nonsupervisory workers in the private sector (up) 6.9 percent YoY in Jan. (fastest since Apr. 2020). *It confirms that the risk of a wage-price spiral is now real with low-income families asking for higher salaries.”

READ: Low Income Voters Believe Bidenflation a ‘Very Big Problem’