Are we starting to see some sort of pushback against the neoliberal thinking of the majority of economists who harp on about the wage-inflation spiral — or to put it another way the need for some workers to live on the dole so that the rest of us can have a more confortable life free of inflationary pressures.

Here is someone other than #GregJericho of The Australian Institute that also thinks this #RBA mantra is utter bull dust.

“…[economists] obsess about an oft talked about, but mysterious concept called the NAIRU, the non-accelerating inflation rate of unemployment.

The theory goes that, if you have just the right amount of workers on the unemployment scrap heap, you can keep inflation in check.

The problem is that no-one knows exactly what the magic unemployment rate is. Even more confusing, it seems to change and, on occasions, such as the past few years, not hold true at all.”

Read more
https://www.abc.net.au/news/2026-02-21/why-economists-hate-low-unemployment-for-inflation/106367852

#unemployment #WageInflationSpiral #NAIRU #Economy #AusPol #NeoClassicalEconomics #NeoLiberalEconomicTheory
#CapoitalismUnbound

Le taux de chômage n'accélérant pas l’inflation. (2017)
https://www.informassue.tuxfamily.org/pages/democratie_election.php?art=inflation_chomage
les pouvoirs en place ne cherchent pas à réduire le #chômage, ils adaptent le taux de chômage pour maintenir un taux d'#inflation stable.

Illustration Miss Lilou
https://dessinsmisslilou.over-blog.com/2017/12/de-l-utilite-economique-et-sociale-du-chomeur.html

#NAIRU #Emploi #Économie #Social #Politique #Société #Salarié #Salaire #Travailleurs #Emploi

Pluralistic: The enshittification of labor (07 Nov 2025)

https://fed.brid.gy/r/https://pluralistic.net/2025/11/07/postwar-social-contract/

#BLS data released today. Last 6 months of #CPI data, as represented in the four most-common ways.

Some believe this month's CPI #inflation data is a sign that the Feds should lower rates. I haven't any idea why they think this.

The data is showing inflation remains at or above the inflation target with no signs of dropping *below* the target, with a steady unemployment rate. A person looking at #NAIRU would interpret this as a sign *not* to lower rates.

#Economy

At least rhetorically, it looks as if the Employment White Paper may dump the #NAIRU definition of full employment. But sounds like there will be no real policy. $61 million (apparently over five years) is trivial

https://www.theguardian.com/business/2023/sep/25/albanese-government-employment-white-paper-tafe-centres-of-excellence-higher-apprenticeships

I've been making this point a lot recently, thinking it was original, but @delong posted it more than a year ago. The accelerationist model of inflation from which the NAIRU is derived works only for the 1970s.

Earlier inflations in the 1950s, and the current #inflation don't fit the model at all well, in either US or Australia.

Pre-NAIRU Keynesian understanding of the Phillips curve saw strong aggregate demand as driving both lower unemployment and higher inflation.
In #NAIRU model, transmission mechanism is from (low) unemployment to wages to prices.

https://open.substack.com/pub/braddelong/p/hoisted-from-e-archives-six-episodes?r=254ji5&utm_campaign=post&utm_medium=email

#econtwitter

Appointment of Bullock as RBA Governor reaffirms #Labor's commitment to #NAIRU model, inlcuding need for unemployment above NAIRU to keep inflation down.
Labor has abandoned Full Employment, or redefined it out of existence. #econtwitter

But #RMITFactlab declined to list Albanese's commitment to a Full Employment Summit and White Paper as a promise, let alone assess whether it has been broken.