Josh Sosland
In her regular congressional testimony last week, Federal Reserve Chair Janet Yellen painted an upbeat if not rosy picture of the U.S. economy. Citing job growth averaging 180,000 per month this year and an unemployment rate below long-term historical averages, Ms. Yellen said the outlook suggests moderate economic growth is likely the next two years and warrants continued gradual increases in the federal funds rate.

To demonstrate the breadth of the economic recovery, Ms. Yellen pointed to strong consumer sentiment growth in household spending and wealth as well as declining unemployment rates for minorities. Still, other data suggest that large segments of the population continue to feel economic stress. The mostly positive June employment report from the Department of Labor showed hourly wages rising a measly 4c an hour, an annualized rate of about 2%.

Anemic wage growth has been a drag for years, even decades now, on industries like grain-based foods reliant on consumption across the entire U.S. economy. For example, an update on the cracker market shows a sales decline over the past 12 months, both in units and dollars. Other grain-based foods markets have been performing similarly. Businesses rightly complain that many components of labor costs, especially health care, have been moving steadily higher. At the same time, for grain-based foods a modicum of wage inflation may not be entirely unwelcome.