U.S. Wages Grow 2.9% Over Past Year, Information Industry Experienced Highest Wage Growth of 5.6%
Wednesday, May 2nd, 2018
Wages for U.S. workers grew 2.9 percent over the last year, increasing the average wage level by $0.57 to $27.36 an hour, according to the ADP Research Institute Workforce Vitality Report released. The growth, down from 3.1 percent annual growth as of December 2017, was driven by strong wage gains for workers in the information industry (5.6 percent wage growth, $41.38 average hourly wage), in the West (3.5 percent, $29.27) and from small businesses (3.3 percent, $25.47). Employees in the resources and mining industry (1.7 percent, $34.96) and in the South (2.5 percent, $25.61) had the slowest wage growth.
"In the first quarter of 2018 we saw an acceleration in wage growth for job switchers," said Ahu Yildirmaz, co-head of the ADP Research Institute. "Additionally, as the labor market tightens employers in some industries are paying a premium for talent with special skills. Job holders, job switchers and new entrants in the construction and information industries are all experiencing significant wage growth as employers seek to attract and retain the skilled labor these industries require."
Among industries, information continued to lead the way for both wage level and wage growth. In addition to the top overall wage growth number of 5.6 percent, new entrants into the information field had 7.6 percent wage growth. Those who successfully switched positions within the information industry had wage growth of 8.3 percent. Employment in the information industry, however, grew just 1.2 percent.
The resources and mining industry had the lowest overall wage growth, just 1.7 percent. New entrants into the field showed negative wage growth, at -3.5 percent. Employment in the resources and mining industry grew 4.2 percent.
Table 1: Wage and Employment Growth by Industry – March 2018
|
Industry |
Wages |
YOY Wage Growth |
Yearly Growth |
||||
|
All |
Holders |
Entrants |
Switchers |
Employment Growth |
Switching Rate |
||
|
-ALL- |
$27.36 |
2.9% |
4.9% |
5.2% |
4.4% |
1.8% |
21.3% |
|
Goods |
|||||||
|
Resources and Mining |
$34.96 |
1.7% |
5.4% |
3.5% |
3.2% |
4.2% |
13.4% |
|
Construction |
$27.56 |
2.2% |
5.6% |
6.8% |
7.3% |
2.8% |
15.5% |
|
Manufacturing |
$28.44 |
2.6% |
4.7% |
6.5% |
4.7% |
1.2% |
17.5% |
|
Services |
|||||||
|
Trade, Transportation, and Utilities |
$24.11 |
3.1% |
4.8% |
6.6% |
3.0% |
1.0% |
22.8% |
|
Information |
$41.38 |
5.6% |
6.3% |
7.6% |
8.3% |
1.2% |
17.7% |
|
Finance and Real Estate |
$32.41 |
2.3% |
4.7% |
0.7% |
6.6% |
1.6% |
18.6% |
|
Professional and Business Services |
$34.79 |
2.9% |
5.0% |
4.8% |
8.6% |
1.5% |
25.0% |
|
Education and Health Services |
$26.17 |
2.8% |
4.0% |
2.6% |
1.0% |
2.5% |
20.1% |
|
Leisure and Hospitality |
$16.77 |
4.3% |
6.4% |
3.9% |
-4.1% |
2.6% |
26.1% |
Workers in the West continued to outpace other regions with 3.5 percent wage growth. Employees who switched firms in the West experienced 8.2 percent wage growth. Workers in the South had the lowest wage growth at 2.5 percent. By firm size, workers at small firms had the highest wage growth rate at 3.3 percent, though employment growth for small firms was just 0.8 percent.
Table 2: Wage and Employment Growth by Region and Firm Size – March 2018
|
Region |
Wages |
YOY Wage Growth |
Yearly Growth |
||||
|
All |
Holders |
Entrants |
Switchers |
Employment Growth |
Switching Rate |
||
|
-USA- |
$27.36 |
2.9% |
4.9% |
5.2% |
4.4% |
1.8% |
21.3% |
|
MIDWEST |
$25.41 |
2.8% |
4.7% |
4.9% |
1.9% |
1.1% |
20.2% |
|
NORTHEAST |
$30.92 |
3.1% |
4.8% |
5.1% |
5.4% |
1.3% |
22.6% |
|
SOUTH |
$25.61 |
2.5% |
4.6% |
3.8% |
3.0% |
1.8% |
21.2% |
|
WEST |
$29.27 |
3.5% |
5.6% |
7.4% |
8.2% |
2.8% |
21.5% |
|
Company Size |
|||||||
|
-ALL- |
$27.36 |
2.9% |
4.9% |
5.2% |
4.4% |
1.8% |
21.3% |
|
49 or less |
$25.47 |
3.3% |
4.6% |
4.4% |
6.0% |
0.8% |
15.0% |
|
50 to 499 |
$27.65 |
2.9% |
4.9% |
5.2% |
4.2% |
2.0% |
23.3% |
|
500 to 999 |
$28.69 |
1.4% |
5.1% |
3.6% |
4.4% |
2.3% |
22.1% |
|
1000 or more |
$28.14 |
2.9% |
5.0% |
5.8% |
4.0% |
2.3% |
24.3% |
The WVR also revealed that more than 21.3 percent of U.S. employees successfully switched firms in the last year. The highest level of switching was from the information industry to the professional and business services industry. Of all the information workers who switched firms, 30 percent switched to the professional and business services industry.
Table 3: Switchers' Movement by Industry – March 2018
|
Industry from |
Industry To |
||||||||
|
CONST |
EDUCH |
FINRE |
INFO |
LEISH |
MFG |
PROFE |
RESM |
TRADE |
|
|
Construction |
42.2% |
5.3% |
4.8% |
0.7% |
12.1% |
4.9% |
12.2% |
0.5% |
14.6% |
|
Education and Health Services |
1.4% |
61.7% |
3.8% |
0.6% |
7.0% |
2.3% |
10.7% |
0.0% |
9.3% |
|
Finance and Real Estate |
4.2% |
14.1% |
30.7% |
1.5% |
9.4% |
3.3% |
18.1% |
0.2% |
16.2% |
|
Information |
2.0% |
9.1% |
6.1% |
12.8% |
8.0% |
5.8% |
30.2% |
0.2% |
23.2% |
|
Leisure and Hospitality |
3.2% |
8.4% |
3.3% |
0.8% |
52.1% |
2.8% |
11.6% |
0.1% |
15.5% |
|
Manufacturing |
4.6% |
6.5% |
2.6% |
1.4% |
6.7% |
33.3% |
15.7% |
0.4% |
27.0% |
|
Professional and Business Services |
3.2% |
11.5% |
5.9% |
3.3% |
8.9% |
6.7% |
40.8% |
0.3% |
17.3% |
|
Resources and Mining |
10.3% |
2.5% |
4.5% |
0.8% |
2.3% |
12.5% |
16.8% |
30.2% |
19.2% |
|
Trade, Transportation, and Utilities |
2.9% |
9.3% |
4.1% |
1.4% |
12.3% |
7.8% |
13.8% |
0.3% |
45.6% |
