Still waiting for that big raise? It may be a while.
Many economists are starting to suspect that the forces that once drove both wages and prices higher in a virtuous cycle may no longer apply, or at least could be muted for a prolonged period.
Despite a U.S. economy that largely has healed since the Great Recession, they argue that increasing globalization, the shift by shoppers to cheaper online goods, and puny gains in worker output will continue to constrain wage and price increases.
"I don't expect to see a breakout in wage growth for at least the next two years," says Bernard Baumohl, chief economist of The Economic Outlook Group.
Other analysts say the factors suppressing pay increases and consumer price inflation are temporary and should fade within months.
The 4.4% unemployment rate means the pool of available workers is relatively small. That should be leading to sharper pay hikes as employers compete to attract and keep employees. In turn, higher salaries typically force companies to raise prices to maintain profits. And higher prices prompt consumers to ask for still-bigger paychecks.
Average earnings rose 2.5% in June from a year earlier. That's up from the roughly 2% annual pace that prevailed from 2011 to 2014 but below the 3%-plus pre-recession clip in 2007. Of course, salaries in some fields, such as airline pilots and industrial psychologists, rose sharply last year, while pay in others, such as mail carriers and petroleum engineers, declined, according to Moody's Analytics and the Labor Department.