In our December cyclical outlook, we offered a baseline view that the next phase of the business cycle in the U.S. would see a delicate handoff from job growth to wage growth. As we reach full employment, job growth should converge toward labor force growth (meaning a slowdown from 200,000 jobs per month toward 100,000–150,000), but this convergence should come along with an increase in wages. This is textbook macroeconomics: Job supply tends to be increasingly constrained by demographics and labor force growth. As the supply of unemployed labor dries up, the price of labor (i.e., wages) will go up to reduce demand ... (full story)