Interesting point. I remember Thornberg talked about rising benefit costs of employers were taking away from wage increases. I had not considered that wages were also reduced on the employee’s side by higher insurance co-pays. As far as cost of living, that is reflected by using *real* per capita income. I believe per capita income is adjusted by inflation. Of course, I would argue that inflation is actually much higher than the offical CPI, so wages are indeed falling even if the *real* number is the same.
