Karen Dynan (PIIE) and Wilson Powell III (Harvard Kennedy School)
The US economy’s surprising strength in July, adding 528,000 jobs, reflected a still tight labor market despite other signs of slowing economic activity. The rise in average hourly earnings of 5.2 percent over the 12 months ending in July poses a daunting challenge to the Fed’s efforts to tame inflation. The data suggest that employment growth is likely to ease in coming months, reducing wage pressures.
The Peterson Institute for International Economics building is open on a limited basis. Employees and visitors must be fully vaccinated, with a booster shot, and verify vaccination records before entering the building by registering with CrowdPass, a HIPAA-compliant web application service.