Chart: American workers have needed ever-tighter labor markets since the 1970s to achieve decent wage growth: Estimates of the unemployment rate consistent with zero real wage growth (URCZWG) over the 1973–1978, 1979–1988, 1989–2000, and 2001–2007 periods

Figure G

American workers have needed ever-tighter labor markets since the 1970s to achieve decent wage growth: Estimates of the unemployment rate consistent with zero real wage growth (URCZWG) over the 1973–1978, 1979–1988, 1989–2000, and 2001–2007 periods

	Unemployment rate
1973–1978	6.7%
1979–1988	6.9%
1989–2000	5.9%
2001–2007	5.1%

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Notes: Estimates stem from regression using percent wage change as the dependent variable and the unemployment rate as the independent variable, along with dummy variables for the time periods shown. The estimated URCZWG is the constant from this regression divided by the coefficient on unemployment.

Source: Authors’ replication and extension of results from Katz and Krueger (1999)

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The importance of locking in full employment for the long haul

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