Tuesday, June 21, 2016

Atlanta Fed: "Wage Growth moved Higher in May"

by Bill McBride on 6/21/2016 09:16:00 AM

From John Robertson at the Atlanta Fed Macroblog: Wage Growth for Job Stayers and Switchers Added to the Atlanta Fed's Wage Growth Tracker

The Atlanta Fed's Wage Growth Tracker (WGT) moved higher again in May—the third increase in a row and consistent with a labor market that is continuing to tighten. At 3.5 percent, the WGT is at a level last seen in early 2009.

As was noted in an early macroblog post, when the labor market is tightening, people changing jobs experience higher median wage growth than those who remain in the same job. Median wage growth for job switchers has significantly outpaced that of job stayers in recent months. For job stayers, the May WGT was 3.0 percent, the same as in April, whereas for people switching jobs the median WGT increased from 4.1 percent to 4.3 percent in May (the highest reading since December 2007; see the chart).
Atlanta Fed Wage Growth Tracker Click on graph for larger image.

The Wage Growth Tracker is another measure of wages. From the Atlanta Fed:
The Atlanta Fed's Wage Growth Tracker is a measure of the wage growth of individuals. It is constructed using microdata from the Current Population Survey (CPS), and is the median percent change in the hourly wage of individuals observed 12 months apart.
This measure is indicating a pickup in wages, especially for job switchers.