Justin's immediate reaction

What matters most for the average America

How these numbers stack up to historical data

How US inflation compares to peer countries

What’s happening to real wages

How this report may influence the Fed

How the ceasefire's end will affect the data

What Justin is keeping his eye on

The latest CPI report came in better than expected: headline inflation slowed to 3.5% and experienced its largest one-month decline since April 2020. But better-than-expected does not mean problem solved. Falling energy prices were largely responsible for this positive news, and a renewed war with Iran could quickly reverse that progress. As oil prices rise once more, those costs can spread quickly from the gas pump to airfare, shipping, groceries and beyond.

In this episode, Justin also investigates what our current rate of inflation (still historically high) means for your paycheck. Wages may be rising, but higher prices can wipe out those gains. That helps explain why many Americans feel like they’re working just as hard without getting ahead. And while today’s numbers have reduced pressure on the Fed for aggressive interest rate hikes, tariffs, geopolitical shocks, and inflation expectations are still in play, making the road back to price stability far from smooth.

Subscribe on YouTube https://youtube.com/platypuseconomics 
Subscribe on Substack 👉 https://newsletter.platypuseconomics.com

Follow on Social Media @PlatypusEconomics and @JustinWolfers

The latest CPI report came in better than expected: headline inflation slowed to 3.5% and experienced its largest one-month decline since April 2020. But better-than-expected does not mean problem solved. Falling energy prices were largely responsible for this positive news, and a renewed war with Iran could quickly reverse that progress. As oil prices rise once more, those costs can spread quickly from the gas pump to airfare, shipping, groceries and beyond.
In this episode, Justin also investigates what our current rate of inflation (still historically high) means for your paycheck. Wages may be rising, but higher prices can wipe out those gains. That helps explain why many Americans feel like they&rsquo;re working just as hard without getting ahead. And while today&rsquo;s numbers have reduced pressure on the Fed for aggressive interest rate hikes, tariffs, geopolitical shocks, and inflation expectations are still in play, making the road back to price stability far from smooth.
Subscribe on YouTube https://youtube.com/platypuseconomics&nbsp; Subscribe on Substack 👉 https://newsletter.platypuseconomics.com
Follow on Social Media @PlatypusEconomics and @JustinWolfers

From world events to everyday decisions, economics explains it all. Platypus Economics makes it clear, useful, and actually fun.

From world events to everyday decisions, economics explains it all. Platypus Economics makes it clear, useful, and actually fun.

Platypus Economics with Justin Wolfers

Good News on Inflation — With a Very Big Asterisk

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/a91b2cb9-8c14-474c-96d3-b4870177c8f6/transcript

Is this a global story or just American?

Are any countries bucking this trend?

Pros and cons of superstar firms?

What about market power in the labor market?

What’s Justin's policy prescription?

What if more workers owned capital?

Justin Wolfers sits down for The Professor Is In to answer your follow-up questions about labor's declining share of income — the reason a soaring market can coexist with wages that feel stuck. He explains that this isn't just an American story: across industrialized countries, workers have been getting a smaller cut of the pie for decades, which points less to any one country's politics and more at shared forces — bigger "superstar" firms, weaker union bargaining power, and a shared intellectual culture across the developed world.

Justin also unpacks monopsony power — what happens to your wages when only a handful of employers are hiring near you — with the classic example of Hershey, Pennsylvania. Then he gets to what we can actually do about it: stronger, more constructive unions, Australia's superannuation system that turns workers into owners of the stock market, and the "MeganBot 2000" thought experiment that shows why AI could either be utopia or dystopia depending on one very important thing — ownership.

Subscribe on YouTube 👉 https://youtube.com/platypuseconomics
Subscribe on Substack 👉 https://newsletter.platypuseconomics.com

Justin Wolfers sits down for The Professor Is In to answer your follow-up questions about labor's declining share of income &mdash; the reason a soaring market can coexist with wages that feel stuck. He explains that this isn't just an American story: across industrialized countries, workers have been getting a smaller cut of the pie for decades, which points less to any one country's politics and more at shared forces &mdash; bigger "superstar" firms, weaker union bargaining power, and a shared intellectual culture across the developed world.
Justin also unpacks monopsony power &mdash; what happens to your wages when only a handful of employers are hiring near you &mdash; with the classic example of Hershey, Pennsylvania. Then he gets to what we can actually do about it: stronger, more constructive unions, Australia's superannuation system that turns workers into owners of the stock market, and the "MeganBot 2000" thought experiment that shows why AI could either be utopia or dystopia depending on one very important thing &mdash; ownership.
Subscribe on YouTube 👉 https://youtube.com/platypuseconomics Subscribe on Substack 👉 https://newsletter.platypuseconomics.com

If AI Does Your Job, Who Gets Paid? | The Professor Is In

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/d30f0764-9378-427a-833e-b4a5013b827c/transcript

A record low labor share

Paycheck vs portfolio

Accounting for depreciation

Income reporting changes

Big firms changed the game

Power shapes who gains

AI shapes what's next

Putting the story together

The stock market keeps breaking records, but your paycheck doesn't feel like it. In this episode of Diving In, Justin Wolfers explains that disconnect with one number: labor's share of income has fallen to 54.4 cents on the dollar, the lowest share on record. And it’s significantly less than the two-thirds that was common for most of the last century.

Justin fires up the actual data to stress-test the claim — accounting for depreciation and tax-driven accounting tricks. But the decline is real and still stands. Then he sizes what it means for you: a five-point drop in labor's share works out to about $10,000 a year in lost wages for the average worker — while the gains flow overwhelmingly to the very top, where the richest households collect over half of all capital income.

Why is this happening? Giant firms that grow sales faster than payroll, weaker worker bargaining power, and globalization that lets your job move elsewhere. And now AI could either make you more productive and better paid — or automate your job and hand the upside to owners. How we slice that pie is up to us.

Subscribe on YouTube 👉 https://youtube.com/platypuseconomics
Subscribe on Substack 👉 https://newsletter.platypuseconomics.com

Follow on Social Media @PlatypusEconomics and @JustinWolfers

Cited Research:
The Rise of Pass-Throughs and the Decline of the Labor Share: https://zidar.princeton.edu/sites/g/files/toruqf3371/files/syzz2022.pdf
Not a Typical Firm: Capital–Labor Substitution and Firms’ Labor Shares: https://www.econ.queensu.ca/sites/econ.queensu.ca/files/HubmerRestrepo_NotTypicalFirm_Oct2023.pdf
Automation and New Tasks: How Technology Displaces and Reinstates Labor: https://shapingwork.mit.edu/wp-content/uploads/2023/10/acemoglu-restrepo-2019-automation-and-new-tasks-how-technology-displaces-and-reinstates-labor.pdf

One more thing: When I create these videos, I often crunch a few numbers in Stata, with whom I’ve got a paid partnership. Today, I used it to compare labor's share of income with and without depreciation.

You can follow along with me here: https://platypuseconomics.com/stata/labor_share_worksheet.pdf

The stock market keeps breaking records, but your paycheck doesn't feel like it. In this episode of Diving In, Justin Wolfers explains that disconnect with one number: labor's share of income has fallen to 54.4 cents on the dollar, the lowest share on record. And it&rsquo;s significantly less than the two-thirds that was common for most of the last century.
Justin fires up the actual data to stress-test the claim &mdash; accounting for depreciation and tax-driven accounting tricks. But the decline is real and still stands. Then he sizes what it means for you: a five-point drop in labor's share works out to about $10,000 a year in lost wages for the average worker &mdash; while the gains flow overwhelmingly to the very top, where the richest households collect over half of all capital income.
Why is this happening? Giant firms that grow sales faster than payroll, weaker worker bargaining power, and globalization that lets your job move elsewhere. And now AI could either make you more productive and better paid &mdash; or automate your job and hand the upside to owners. How we slice that pie is up to us.
Subscribe on YouTube 👉 https://youtube.com/platypuseconomics Subscribe on Substack 👉 https://newsletter.platypuseconomics.com
Follow on Social Media @PlatypusEconomics and @JustinWolfers
Cited Research: The Rise of Pass-Throughs and the Decline of the Labor Share: https://zidar.princeton.edu/sites/g/files/toruqf3371/files/syzz2022.pdf Not a Typical Firm: Capital&ndash;Labor Substitution and Firms&rsquo; Labor Shares: https://www.econ.queensu.ca/sites/econ.queensu.ca/files/HubmerRestrepo_NotTypicalFirm_Oct2023.pdf Automation and New Tasks: How Technology Displaces and Reinstates Labor: https://shapingwork.mit.edu/wp-content/uploads/2023/10/acemoglu-restrepo-2019-automation-and-new-tasks-how-technology-displaces-and-reinstates-labor.pdf
One more thing: When I create these videos, I often crunch a few numbers in Stata, with whom I&rsquo;ve got a paid partnership. Today, I used it to compare labor's share of income with and without depreciation.
You can follow along with me here: https://platypuseconomics.com/stata/labor_share_worksheet.pdf

No, the K-shaped Economy Isn't Over | Diving In

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/4526d608-a818-4034-bc51-b4a4011b5384/transcript

High inflation is still with us

What's actually new today

Two main drivers - tariffs and Iran

Prices up, wages down

Energy ticked down, but not enough

The burrito discourse (yes, really)

What it means for the Fed

Looking ahead to what's next

The newest inflation report is out, and Justin Wolfers walks you through what actually matters. Annual inflation is running at 3.4% — well above what the Fed wants, and high enough to explain why the checkout line still feels uncomfortable. Core inflation, which strips out food and energy to predict where prices are headed, sits at a better — but still high — 2.5%. July's monthly numbers came in almost exactly as economists expected, which is why the report is less "news" than confirmation: prices are still rising quickly, just about the way everyone thought they would.

Here's what it means for you. Prices are outpacing wages, so real (inflation-adjusted) pay has fallen over the past year — the average paycheck buys less than it did twelve months ago. Energy is the main culprit: gas is up 25% over the year, diesel 39%, and airfares have shot up on the back of it. If you're flying anytime soon, that ticket is a whole lot pricier. Justin also digs into the tariff story, the burrito discourse, a record 16% drop in lettuce prices, and the Fed's tough spot between stubborn inflation and slowing employment growth.

Subscribe on YouTube 👉 https://youtube.com/platypuseconomics
Subscribe on Substack 👉 https://newsletter.platypuseconomics.com

Follow on Social Media @PlatypusEconomics and @JustinWolfers

The newest inflation report is out, and Justin Wolfers walks you through what actually matters. Annual inflation is running at 3.4% &mdash; well above what the Fed wants, and high enough to explain why the checkout line still feels uncomfortable. Core inflation, which strips out food and energy to predict where prices are headed, sits at a better &mdash; but still high &mdash; 2.5%. July's monthly numbers came in almost exactly as economists expected, which is why the report is less "news" than confirmation: prices are still rising quickly, just about the way everyone thought they would.
Here's what it means for you. Prices are outpacing wages, so real (inflation-adjusted) pay has fallen over the past year &mdash; the average paycheck buys less than it did twelve months ago. Energy is the main culprit: gas is up 25% over the year, diesel 39%, and airfares have shot up on the back of it. If you're flying anytime soon, that ticket is a whole lot pricier. Justin also digs into the tariff story, the burrito discourse, a record 16% drop in lettuce prices, and the Fed's tough spot between stubborn inflation and slowing employment growth.
Subscribe on YouTube 👉 https://youtube.com/platypuseconomics Subscribe on Substack 👉 https://newsletter.platypuseconomics.com
Follow on Social Media @PlatypusEconomics and @JustinWolfers

Inflation Is Still High. Just As We Thought. | Diving In

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/d497d8f4-2a4c-4125-8ad6-b4a4010b2e57/transcript

Good News on Inflation — With a Very Big Asterisk

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