Coefficients and r-squareds from wage Phillips curves in different time periods
| Unemployment rate | Prime-age EPOP | ||||||
|---|---|---|---|---|---|---|---|
| Coefficient | r-squared | Coefficient | r-squared | ||||
| 1979–2000 | -0.904 | *** | 0.940 | 0.505 | *** | 0.759 | |
| 2001–2007 | -0.341 | * | 0.745 | 0.441 | *** | 0.802 | |
| 2008–2013 | -0.018 | 0.320 | 0.372 | *** | 0.523 | ||
| 2014–2018 | -0.211 | 0.383 | 0.196 | *** | 0.480 | ||
*** indicates significant at 1 percent
* indicates significant at 10 percent
Note: Regression coefficients are from a regression of nominal wage changes on the measure of labor market slack (either the unemployment rate or the prime-age employment-to-population ratio) and a measure of expected inflation. This inflation measure is a weighted average of the previous 12 quarters’ inflation rates, with a weight of 12.5 percent on the previous 4 quarters’ inflation rates, 10 percent on each the inflation rates between four and eight quarters ago, and a weight of 2.5 percent on inflation rates between nine and 12 quarters ago.
Source: Unemployment rates and prime-age employment-to-population ratios are from the Bureau of Labor Statistics (BLS) Current Population Survey and wages are the average hourly earnings of production and nonsupervisory workers from the BLS Current Employment Statistics.
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