Americans' wage expectations have reached record highs, with the average reservation wage for job seekers climbing to $78,645 in July 2023, reflecting the current economic and labor market conditions, including inflation and increased prices following the pandemic, according to a survey by the Federal Reserve Bank of New York. While wage expectations have risen across the board, men and college graduates have higher demands than women, suggesting a need for more preparation and salary transparency to address the gender pay gap.
New hires are experiencing declining wages in various sectors such as technology and transportation, which could impact job hopping and take time to reflect in federal data, posing challenges for the Federal Reserve in managing inflation.
The trend of hefty pay increases for new hires is reversing, with the average posted pay for more job titles declining rather than increasing so far this year, according to data from ZipRecruiter, indicating a potential end to a brief golden age of wage growth for job seekers.
The US jobs data for July suggests a cooling employment market, with a drop in labor demand and easing of hiring conditions, which could help lower inflation without a significant rise in unemployment rates.
The August jobs report is highly anticipated as investors assess the health of the labor market amidst rising interest rates and inflation, with projections indicating an increase in hiring and a steady unemployment rate, but potential disruptions from ongoing strikes and bankruptcies could affect the data. The report is closely watched by the Federal Reserve for signs of labor market softening as they grapple with inflation, and while the labor market has remained tight, there are indications of a gradual slowdown. Job openings have decreased, along with resignations, pointing to a labor market that is cooling.
The US job market shows signs of slowing but remains resilient, with 187,000 jobs added in August and a rise in the unemployment rate to 3.8%, as more people actively look for work. Wage gains are easing, signaling a potential slowdown in inflation, and the Federal Reserve may decide against further interest rate hikes.
US job growth picked up in August, but the unemployment rate rose to 3.8% and wage gains moderated, signaling a slowing labor market and reducing expectations for a September interest rate hike by the Federal Reserve.
Union workers across industries, including the United Auto Workers, are demanding substantial pay raises of around 50% over four to five years, citing years of stagnant wages and robust company profits, with some unions successfully securing significant wage increases that exceed the expected rate of inflation.
Wage growth in the UK has caught up with rising prices, resulting in real pay no longer falling, according to official figures, although the unemployment rate has risen and job vacancies have fallen. The data will also impact the state pension, which is set to increase by 8.5% next April.
The UK jobless rate rises to 4.3% as unemployment increases, but wage growth surpasses inflation, with total pay rising by 8.5% and regular pay growing by 7.8% in the May-July quarter.
The jobs market is currently in a relatively benign position, with unemployment rates and wage growth neither extremely high nor low, but leading indicators suggest a potential rise in unemployment and a continued deceleration of wage growth in the coming quarters.
Wages in Brighton and Hove have outpaced inflation, while the UK as a whole has seen a real-terms pay increase for the first time since March 2022, although low-paid workers in certain sectors continue to experience wage stagnation.