IN one year, workers' wages in the US increased by 5.3%. And employees who changed jobs in the last two years benefited the most, according to one study. While a competitive labour market is prompting companies to raise wages, the picture is more complicated given the high levels of inflation in the country.
The US job market continues to be in turmoil. Approximately 4 million workers have quit their jobs in search of better conditions since the start of the Covid-19 pandemic. Wages are among the main reasons for this "great resignation."
Statistics revealed by the Bureau of Labor Statistics show that workers' incomes have risen by 5.3% over the 12-month period ending in June, making 2022 the year with the largest increase since 2001, according to CNN.
The report indicates that the private sector is particularly affected. The leisure and hospitality industry (about 10%) and retail (about 7%), previously criticised for being underpaid sectors, saw the biggest increase, according to the quarterly results of the U Labor Department.
The tight labour market is said to be driving up wages.
Increase in salaries
To recruit in areas experiencing staffing shortages, some companies have been increasing monetary rewards or using benefits to attract talent.
On Wall Street, for example, this competition for workers has led companies to raise salaries for interns by 40%. At the Jane Street trading firm, they can earn up to US$16,356 per month.
In general, job changes have led workers to higher wages. The Pew Research Center surveyed 6,174 people in a recent study to create a picture of the individual experiences of workers who have changed employers since January 2019.
In the sample of testimonials collected by the thinktank, 60% of workers who changed jobs saw their real earnings increase compared to the same period a year earlier. In comparison, fewer employees who stayed with the same employer (47%) saw an increase in income.
Change of profession and sector
The increase in income is also explained by changes in sectors and professions. According to Pew's report, nearly half of the workers who left their jobs (49.5%) also moved to another sector.
The industries left behind remain the most precarious. Movements that may also be at the root of some of these wage increases.
So is this good news for employees? In a situation of inflation, where everything is increasing (the cost of transport, food, etc), this increase allows certain professions to keep an acceptable pace of life. But when inflation is taken into account the picture is much less rosy. – ETX Daily Up, August 3, 2022
