Part 2: The Cost of a Stagnant Workforce

Jul 31, 2023 | Macro Insights, No Bull Economics

In our previous post, we looked at why & how stagnant wages have hurt consumer spending which drives 68% of U.S. GDP growth. There are global repercussions from this failure that have grown too big to ignore. 


  • The chart below highlights indexes to compare the historical growth of the U.S. GDP with that of China.
  • The obvious conclusion of this chart is that the U.S. market has largely become irrelevant on a global scale and this point has not been lost on the major U.S.-based multi-national conglomerates who are increasingly focusing their attention on faster-growing economies around the world, with particular emphasis on markets like China & India which are expected to develop consuming middle-class populations that may eventually dwarf the increasingly impoverished U.S. market.
  • While this may be good for China & India, it is very bad news for Americans, and it is time for us to address this alarming global discrepancy.   
  • Additionally, it is time for Americans to question the Fed’s current policy of seeking to further suppress domestic economic growth in an ill-conceived effort to combat the remnants of a supply-side inflationary shock that continues to unwind. The Fed is badly exacerbating our deteriorated global positioning.  
  • Instead, we need to drive growth for wages, consumption, and output (for both services & manufacturing) sufficient to impress the global multinationals to look to the U.S. market as the place to be once again.   
China vs US GDP
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