Given these conditions, wages should be rising sharply. But look at this chart from the Atlanta Federal Reserve: They haven’t been, and they’re not. Every month when the government releases its latest employment data, newspapers call up small business or large companies, usually in the Midwest or Sun Belt, who testify to their frustration. Last week, the New York Times featured a Columbus, Ohio, cleaning company owner mystified that he couldn’t find applicants for his $9.25-per-hour jobs (“I sometimes wish there was actually a higher unemployment rate,” he actually said) and a Nebraska roofer who couldn’t figure out why nobody applied for the $17-an-hour jobs she was offering. “The pay is fair,” she said.

Actually, if not a single person applies for your job, the pay probably isn’t fair. But that’s where America remains stubbornly stuck: Employers won’t pay enough, and workers either won’t or can’t demand more. There are likely a lot of reasons, but the biggest, or least most fixable, may be psychological: From an economic perspective, both sides of the hiring market should have the power to increase overall wages in the current climate—but they aren’t.

Pay workers more. Oli Scarff / Getty Images It’s funny to laugh, of course, at the cluelessness of employers who are supposed to understand the fundamentals of supply and demand. But their inability to fill jobs is really bad economic news for several reasons. Every unfilled position is a personal tragedy: Imagine what your life would be like if someone in your household lost (or couldn’t find) a payroll job, or hadn’t received a raise in eight years, even as your family’s spending power had shrunk and its costs had grown. And they are likewise a serious economic issue. Americans tend to spend most of what they make on consumer goods, on their rent and mortgage payments, buying cars, investing, and so on. If just 1 million of those 5.7 million job openings were filled at a median pay of $47,000, that would mean an extra $47 billion annually moving from corporate balance sheets into the wallets of Americans. And from there, quickly into the economy.

Why isn’t the labor market functioning the way we would expect? Why aren’t employers bidding more aggressively to fill open positions? And why are American workers, at a time of low unemployment and high job openings, settling for the crappy or nonexistent raises they’re getting?

There could be a skills gap in which the workers out there simply don’t have the training necessary to fill the open jobs. Or it could be that, as Binyamin Appelbaum of the New York Times ventured on Twitter, that “a lot of American businesses have lost the muscle memory of how to compete for workers.” That is to say, they have literally forgotten the words to use, and the tools to deploy, when workers aren’t lining up in droves to fill their positions.

But these aren’t really reasons. They’re symptoms of something deeper at work. The stock market crash of 1929 and the Great Depression left deep scars and influenced consumer and investor behavior for decades. Americans remained risk-averse and shied away from stocks for whole generations after the breadlines and Hoovervilles had faded into sepia-hued memory. We haven’t completely come to grips with it, but the financial panic of 2008 and the Great Recession that followed inflicted similarly deep wounds on both businesses and workers that have changed behavior and norms—and it’s those norms that are depressing wages more than anything else.

How did we get here?

We live in an age of long business cycles and rare and shallow stumbles: In the 25 years between November 1982 and December 2007, there were only two recessions, each of which lasted just eight months. But the 18-month recession of 2008 to 2009, and the remarkably destructive debt crisis that fell in the middle, led to near-death experiences for many companies (and real-death experiences for large chunks of the banking and auto industries).