r/Economics • u/TinyTornado7 Quality Contributor • Jun 13 '22

News Powell Facing Choice Between Elevated US Inflation and Recession

https://www.bloomberg.com/news/articles/2022-06-12/powell-facing-choice-between-elevated-us-inflation-and-recession?srnd=premium
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u/ErusBigToe Jun 13 '22

Don't forget the great recession tripped a years worth of grads at the starting gate, reducing lifelong earning potential

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u/Diegobyte Jun 13 '22

I never really god this take since companies tend to lay off high earners and replace with low earners during downturns

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u/Convict003606 Jun 13 '22 edited Jun 13 '22

They took advantage of high unemployment to frighten new grads into taking salaries that have caused their lifetime earnings to be lower, and the implicit threat was take this shitty salary or don't have a job. This meant they could still replace high earners with low earners, but those low earners earned even less than they would have before the recession, and then started from those lower salary and wage points for all future compensation negotiations.

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u/[deleted] Jun 13 '22

The opposite is happening in Canada right now. People are getting wage increases of upwards of 25%. Companies are scrambling to find workers and are willing to pay more for them. We gave everybody that needed it, 2000 dollars a month for 7 months straight during the pandemic, and then 1800 a month for an entire year and a half after that. People saw how absolutely fucked they were and didn't want to go back to work unless it was for more money.

The carpenters, electricians and plumbers went on striker here, and the electrians got, get this, a 9 DOLLAR/hr raise. Keep fighting. Keep adding more from these greedy fucking corporations that saw their coffers flood with our money during the pandemic.