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With the U.S. unemployment rate at its lowest level in decades, today’s jobs market has been touted as one of the strongest in history. However, one employment indicator has lagged well below what we have seen in previous economic expansions – wage growth. Americans have simply not seen the increases in their salaries that usually occurs when unemployment is this low. One interesting fact is that in terms of wage growth across different industries, much more wage growth has occurred in lower-paying jobs than jobs with more lucrative salaries. The chart above shows the percentage change in wages for restaurant/fast food workers, manufacturing, and professional and business services over the last five years. As you can see, the wage growth in restaurants has far outpaced those of higher-paying manufacturing and professional service jobs. Much of the increase in restaurant jobs has been driven by increases to the minimum wage, while higher paying jobs have not seen such increases. Recent data has shown that wage growth may finally be materializing, but until that happens, American workers will likely disagree if you classify today as the strongest job market in history.
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