In Portland, there was a time in 2000-2002 where Nike and Intel had contract offers out to SW developers for $12/hour, and were getting slammed with applications.
I don't understand why. People spend money on other things besides housing. Because people spend money on multiple things, it doesn't really make that much sense to say that our index of inflation should track be one thing. I mean, if the price of food and healthcare tripled, I think you would probably say that the inflation metrics should go up.
Ofc, focusing on just one thing is very convenient for people who want to tell a particular story. (inflation is so bad! look at housing! there's so much deflation! look at food and TVs!)
I think it's because housing is the biggest expenditure for my family. Like I said, you should build your own index, not using the CPI or other people's index. Similarly, change in life can increase expenditures, too, e.g. getting a child prompts the family to buy a house instead of staying in a condo.
For my family, housing is easily the primary expenditure -- around 6,000 CAD while (food + vehicle) amount to less than 2,500 CAD monthly. For a similar family in the same area with on vehicle, I estimate that housing probably takes at least half of their expenditure.
Yes, that would be stupid, which is why it doesn't work that way. The basket is weighted according to how much people spend on each item. Eggs are not weighted the same as rent.
The CPI does have a problem with not updating the basket as frequently as it could, which means it doesn't catch substitution effects and tends to overstate inflation.
It'll never happen because it shines a light on uncomfortable facts that would risk far too much cognitive dissonance across the political spectrum. Please keep the discourse to identity politics, culture wars, the Epstein files, and large-scale, unprovoked acts of international warfare; those will all be much easier for us to talk about as a nation than what we should do about housing prices.
Not even close, not when all things are considered. $50/hour is 100k/year, which is still considered a decent salary. 24k/year in 2000-2002 was definitely not considered a decent salary. $12/hour for sw engineers was evil. I hung up on that recruiter and cursed for a while, cold-called my way to a transitional $20/hr job, and then finally landed somewhere at $55/hr which is when things started to feel normal again. $55/hr back then is not the same as $230/hr now.
I started my career at $14/hr in 1999, was at $19/hr in 2000, and switched to salary at $55k by 2001. I spent 15 years in corp IT running software teams... total comp got way better when I entered the big tech industry in 2015.
