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Softer Escort Prices Provide Context On U.s. Jobs: Opening Line

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http://mobile.bloomberg.com/news/2014-11-07/softer-escort-prices-provide-context-on-u-s-jobs-opening-line.html?cmpid=yhoo

A job seeker waits to be interviewed during a Virgin Hotels job fair in Chicago, Illinois, U.S., on Nov. 5, 2014. The number of people filing jobless claims for the first time in the U.S. dropped to a three-week low of 278,000 in the week to Nov. 1, below the 285,000 median forecast of 50 economists surveyed by Bloomberg.

It’s jobs day, and we’re not the only ones who think the number might be big. Of course, what we know about economics could fit in a thimble. We’re not even sure sometimes when someone’s referring to Fisher or Fischer.

So far this week, initial jobless claims came in less than forecast, the ADP employment figure was bigger than estimated, and Bloomberg’s Consumer Comfort Index rose almost to a five-year high. Yet there are so many ways to slice up economic numbers that to us it often appears to be a push. Labor costs remained muted as productivity improved. If you’re looking for some inflation, notably wage inflation, you’re not finding much.

It must be difficult to find a good reading on wages. The gang out at SouthBay Research, and by gang we mean Andrew Zatlin, discovered some signs of wage inflation a couple weeks ago in the earnings report from Brinker International, the owner of restaurant chains Maggiano’s and Chili’s. In a research note yesterday, he wrote that employment growth this year has been concentrated mostly in minimum-wage jobs, where wage inflation is still spotty. One element we might deduce from Tuesday’s election results is that the minimum wage is a growing issue because it’s not growing enough, notably for those earners.

So you’ve got all these mixed signals out there, and what we could really use is a street-level view of the current wage environment. Zatlin does that, uh, literally, with his vice index. It includes prostitution, drugs, gambling and alcohol.

In a sign of lower income and middle income consumer stress, some prostitutes are dropping prices,” he wrote. “It is selective and limited in scope: mainly low-tier and mid-tier escorts. High-end escort prices are holding up.”

Oh dear, it looks like adding hookers to the GDP figures might not have been the best idea....

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Edit: Oops, I should warn for lot of swearing etc.

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