State of the Labor Market

March Jobs Report Preview: A Strong Labor Market Is Adding Jobs in Higher-Paying Industries


In recent months, workers have finally been getting the acceleration in wage growth they were waiting for. But improving earnings prospects for workers isn’t just about growth in wages: since the end of 2017, the economy has been adding jobs in middle- and high-wage industries at a faster pace than in low-wage industries. Low-wage industries include gasoline stations, child day care services, and food and drinking establishments; middle-wage industries include air transportation and residential building; and high-wage industries include legal services and hospitals.

Middle-wage industries in particular have seen a pick-up in growth: near the end of 2017 those industries were growing at around 2%, but in October 2018 reached a high of 2.7%. Job growth in high-wage industries accelerated to 2.3% in January 2019. Meanwhile, growth in low-wage industries has been steady at around 1.5%.

As discussed in previous Hiring Lab work, wage growth is currently fastest in low-wage industries (at over 4%, compared to less than 3% in middle- and high-wage industries). An economy in which wage growth is speeding up in low-wage industries, and employment opportunities are opening up in middle- and high-wage industries, is an economy that is good for workers.

This Friday I’ll be looking to see:

  1. If the jobs numbers rebound as expected from the abnormally low number last month. In the past, similar months have typically been followed by a strong number the next month;
  2. If the economy continues to add jobs in higher-paying industries and see wage growth in lower-paying industries;
  3. And if workers who haven’t felt the recovery as much, like the long-term unemployed and those working part-time but would prefer full-time work, find the jobs they want.
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