February Jobs Report Preview: Wage Growth Is Happening Fastest for Workers in Low-Wage Industries
Starting in mid-2018, the long-awaited pick-up in wage growth seems to have arrived. In January 2019, wages grew by 3.2% year-over-year, up from the general 2.6-2.8% range wage growth had been hovering from mid-2016 to mid-2018. So where is this acceleration in wage growth coming from, and who is benefitting? The pick-up in wage growth seems to be stemming from low-wage industries. (Low-wage industries include department stores, employment services, and food services and drinking places).
Over 2018, wage growth in low-wage industries was 4.4%, while in middle- and high-wage industries it didn’t top 3%. Put another way: low-wage workers are likely the ones who are seeing the benefits of accelerating wage growth. A tighter labor market seems to be putting particular pressure on the lower-paid end.
This Friday, I’ll be looking to see:
- If wage growth continues to accelerate for low-wage industries;
- If the spike in workers working part-time who would have preferred full-time work due to the government shutdown disappears;
- If the continued streak of record job growth can bring down the long-term unemployment rate any further.
Martha Gimbel is the Research Director for the Hiring Lab. Previously she was the Research Director and Senior Economist at the Joint Economic Committee on Capitol Hill, a senior policy advisor to the Secretary of Labor, and an economist at the Council of Economic Advisers focusing on labor market issues. She has an undergraduate degree from Brown University, where she studied classics and economics, and a master’s degree from the University of California, San Diego in economics.