Sometimes it's automatic as some firms tweek wages yearly for the cpi. Tweeking up is easy but tweeking down is different, what some economists call 'sticky' prices that don't move easily like say, food prices. When employers lower wages they cut benefits or they lay folks off, delay raises, and then hire new workers at lower rates.
Deflation is lower prices -including the price of labor.
Thanks, that makes sense. So it isn’t like one day they come and say hey bud you make XK less now.
It is just laying off low-performers and hiring new people at cheaper salaries.
Makes sense. heh. Our company does that all the time anyway.