Was today’s June employment release a Goldilocks report? Payroll employment rose 372,000, and wages increased 0.3%—not too hot, not too cold. The problem is that consumer prices have been rising faster than wages for the past year or so. As a result, the purchasing power of our Earned Income Proxy for private wages and salaries in personal income has been significantly eroded by higher prices (chart). That’s why consumer confidence has been very depressed notwithstanding the strong labor market.