The National Association for Business Economics, in its newest business conditions survey, reported that the percentage of U.S. companies that increased wages in the quarter through July more than doubled, indicating wage growth is accelerating.
NABE reported that 43 percent of the 79 economists involved in the survey revealed that their companies had hiked wages, compared with 19 percent a year ago. This is a notable improvement from the 35 percent recorded in the quarter to April, reported Reuters.
“For the third survey in a row, an increasing share of panelists reported rising wage costs last quarter,” disclosed NABE President Jack Kleinhenz, who also serves as the chief economist of the National Retail Federation.
The report also revealed that this was the first time since October 2012 that there were no reports of reduced wages in the firms involved in the survey. The companies involved in the study are drawn from manufacturing, services, and finance and transportation industries. 40 percent of those companies have more than 1,000 workers on their payrolls.
NABE’s poll now confirms that wages are increasing. Recently, the National Federation of Independent Business (NFIB) poll’s compensation gauge currently stands at the highest level in six year, having been increasing since late 2013. The data is still unconvincing to the Federal Reserve Chair Janet Yellen, who maintains that the wage increases are still yet to spark inflation.
NABE reported that in the three months to July, 59 percent of those surveyed in the real estate, finance and insurance industry disclosed that wages rose in their respective sectors. Half of the participants drawn from information and communications, utilities and transportation reported increasing wages. 35 percents of the respondents in service industry said they increased wages while those in manufacturing industry who reported so were 11 percent.
The percentage of businesses that boosted hiring stood at 36 percent in the quarter to July compared with 29 percent a year earlier. This compares with 28 percent in the three months through April. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
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