Friday’s Jobs Report: Searching for Sustained Pay Gains
Friday’s January jobs report will provide some clues about the state of the labor market as the economy entered 2018, and how the recent tax bill may be — or may not be — impacting Americans’ paychecks. Here’s what we’ll be watching for:
- +168,000 new jobs added to nonfarm payrolls in January;
- Unemployment rate down slightly to 4.0 percent;
- Average hourly earnings up 2.5 percent from one year ago;
- Labor force participation rate down slightly to 62.6 percent.
Since the passage of the recent tax bill, there have been many reports of companies paying one-time bonuses to workers. But what about sustained raises in base pay?
For the nation overall, wage growth has been sluggish for years, averaging around 2.5 percent over the past year according to BLS figures. In Glassdoor salary data, pay growth has been even weaker, averaging around 1-2 percent over the past year. There are some pockets of the labor market where pay is rising fast today — most notably e-commerce, health care, and certain in-demand tech roles. But overall, setting recent tax-related bonus announcements aside, most workers aren’t seeing healthy pay gains today.
Jobs Where Workers are Getting Ahead
As the economy turned the page on a new year, we took stock of which jobs in America are seeing the most robust long-term pay raises on Glassdoor. Since pay growth can be volatile in a single year, we looked at pay raises over the past four years — from 2014 to the present — for the nearly 85 job titles we track in our Local Pay Reports. This gives a longer-term view of which workers are really getting ahead in today’s economy, and which aren’t.
Below is an interactive chart showing total percentage growth in median base pay for full-time workers over the past four years for 84 jobs, in ten metros and for the U.S. overall. Try exploring the data yourself using the drop-down menus and hover-over tools:
Here are some of the key takeaways on wage growth in America today we’re seeing on Glassdoor.
- For professional services jobs, customer service is king. As companies move to automate more of their businesses with off-the-shelf AI and machine learning tools, the people who fill in the gaps in technology by assuring great customer experiences are seeing pay rise. Since 2014, pay is up 12.6 percent for customer service managers, and up 9.0 percent for customer service representatives. By contrast, the weakest pay growth in professional services has been for communications managers (up just 3.3 percent) and program managers (up 4.2 percent), many of whom are employed in the nonprofit sector.
- For food services jobs, coffee-serving baristas have enjoyed tremendous pay gains, with pay up 17.7 percent since 2014. Similarly, pay for restaurant cooks is up 15.4 percent. By contrast, the labor market for bartenders is the weakest in food services, with median base pay nearly unchanged (up just 0.8 percent) over the past four years.
- For education jobs, teachers have seen healthy pay gains in recent years, with median base pay up 8.1 percent since 2014. By contrast, pay for university level professors and research assistants has lagged behind, growing by just 2.8 percent and 4.1 percent, respectively, in the past four years.
- For engineering jobs, there is a hugely diverse labor market today. Pay for in-demand electrical and design engineers is growing rapidly, up 10.2 percent and 6.7 percent, respectively, since 2014. By contrast, two engineering roles that often work in manufacturing — quality engineer and mechanical engineer — saw the weakest pay gains in recent years, with median pay up just 3.4 percent and 5.4 percent over four years, respectively.
- For HR jobs, today’s tight labor market has put human resources professionals in high demand, and that’s translating into pay growth. Both recruiters and HR managers are enjoying strong pay growth today, with median pay up 9.5 percent and 8.2 percent, respectively, since 2014.
- For tech jobs, the biggest pay gains in recent years have been for software engineers (up 9.6 percent), technical support (up 8.8 percent), and data analysts (up 8.6 percent) since 2014. By contrast, pay for highly specialized java developer roles grew just 3.9 percent, reflecting changing demand for coding skills in the tech world. Similarly, data scientist pay has risen just 4.1 percent over four years — reflecting the huge increase in supply of new data scientists aiming to enter that field.
- For health care jobs, pay for lower-level professionals that are taking on more health care delivery tasks are seeing the fastest pay gains. Medical assistant pay is up 12.7 percent since 2014. Similarly, pay for medical technologist is up 10.4 percent, while pharmacy technician pay has risen 10.4 percent. By contrast, the market for physical therapists has been weakening in recent years, with median pay up just 0.5 percent over the past four years.
What’s the lesson here? While average U.S. pay growth has been sluggish recently, the topline figures conceal important diversity in America’s wage picture. There isn’t a single U.S. labor market — labor markets are often local, and differ enormously by occupation and metro area.
Beneath the surface of average wage gains, many jobs today are experiencing very robust wage growth, thanks to growing labor shortages and rising productivity for these roles. On the contrary, many workers in declining fields — some of which are being negatively impacted by growing automation — are experiencing flat and in some cases falling average pay.
As the labor market continues to tighten in 2018, watch for more occupations to begin seeing wages pick up as employers find it more and more challenging to fill open positions — and watch for that to translate into sustained pay growth for average U.S. wages in turn.
To speak with Dr. Andrew Chamberlain about this month’s jobs report or labor market trends, contact pr [at] glassdoor [dot] com. For the latest economics and labor market updates, subscribe to email alerts here and follow @adchamberlain.