News Briefs

In a Wall Street Journal op-ed, William Isaac and Richard Kovacevich argue that the Federal Reserve should target a lower inflation rate in the future. The authors contend that low inflation has benefited workers and the American middle class, who have experienced sluggish nominal wage growth but have seen some real income gains due to persistently low inflation. WSJ

The Wall Street Journal reports that new survey data show that business are increasingly using payroll dollars for performance-based pay rather than guaranteed raises. According to the survey, two-thirds of firms plan to use merit pay to encourage employee performance while a quarter of firms said they would reduce or eliminate raises for low performers. WSJ

Patricia Cohen of the New York Times writes that despite record-high median real household incomes in the United States, many Americans still face stagnant wages and rising inequality. Cohen argues that despite higher median earnings, younger generations are actually making less over their careers than older generations, which has contributed to widening inequality. NYT