Let me tell you a story of the battle between the “inflation targeters” and the “accelerationists.” You’ll want to hear this bit of economic history because you want to know whether the Fed might raise interest rates after the latest rosy employment report.

The Fed is struggling with what conclusions to draw from the recent uptick in wage growth, because despite that uptick, wage growth remains anemic. Economists interpret data through the lens of theoretical models, and the central theory used within the Federal Reserve is a concept called the Phillips curve. At its heart, this theory simply says that when unemployment falls below its long-run sustainable rate, good workers become hard to find, leading firms to offer higher wages. Eventually, this rise in wage growth will feed through into higher inflation. And this matters to the Fed, because it is targeting an inflation rate of around 2 percent.

The problem is that no one knows whether unemployment is above or below its long-run sustainable rate, which is often called the natural rate. The latest data suggest that unemployment is currently 5 percent, while a recent survey found that some economists believe that the natural rate might be as low as 4.25 percent, while others think it’s as high as 5.8 percent.

Historically, an unemployment rate of 5 percent would be thought to be close to the natural rate. But with hundreds of thousands of part-timers still unable to find full-time work, it is hard to believe the labor market is close to overheating. Add in the millions of jobless people who aren’t officially counted as unemployed because they aren’t looking hard enough for work, and it looks as if the economy could employ more workers without fueling inflation. Special factors like this muddy the precision of the Phillips curve framework, and this is why sophisticated statistical analyses suggest that the margin of error around estimates of the natural rate might be plus or minus 1.5 percent. That’s an extraordinary degree of uncertainty.