Waning Wages

A wage-price spiral looks increasingly unlikely. Y-o-Y wage growth has steadily decelerated from a recent peak of 5.1% in 22Q2 to now 4.3%, the lowest reading since 21Q4. Moreover, the index has slowed four out of the last five quarters. Relatedly, in 23Q3 labor productivity rose at an annualized rate of 4.7%, the fastest pace in three years. Thus, unit labor costs declined at an annualized rate of 0.8%.