Personal tax burdens have been rising, largely from real income tax bracket creep and higher Social Security payroll tax thresholds. So it's no wonder that employees seek non-cash forms of compensation, from clothing discounts right up to deferred compensation bonus plans, including stock options. A more interesting point than understated wages is the New Economy rise in productivity, which has lowered unit wage costs and increased profits. If the government properly counted software, telecommunications and the Internet, productivity rates would be even stronger. The bottom line point to all this is that the overall economy is sound.
Inflation is low, productivity is high, wages are moderate and profits are strong.
If there is a shift in labor market conditions, it's a small downward move in the demand curve, not the supply curve. If there were a labor force shortage, then wages should be rising excessively. But it's not happening. Mr. Greenspan works from the same data files as everyone else. Surely he sees this.