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The PayScale Index Q3 2016 – Steady Growth and a Few Happy Surprises

Every quarter, thousands of companies use The PayScale Index to stay updated on economic trends as they pertain to wages. We track quarterly changes in total cash compensation for:

  • United States
    • Full-time, private industry employees in 18 different categories
    • A broad range of company sizes, from small to enterprise
    • Wages in 15 industries across the 20 largest Metropolitan Statistical Areas (MSAs)
  • Canada
    • Full-time, private-industry employees in the six largest metropolitan areas
  • United Kingdom
    • Country-wide trends for full-time, private industry employees

Q3 2016 Trends in the United States

In the third quarter of 2016, we are happy to report that US wages were strong at the national level – just as they have been since the first quarter. Even better, the wages show continued growth at 10.5% above pre-recession wages from 2006. Year-over-year, the average US wage rose by 2.3%. Digging a little deeper into our data, we found that wage increases significantly ranged across the US. As an example, average wages rose by 3.9% in San Diego, whereas in St. Louis they rose by just 0.8%.

Looking at quarterly growth, the average US wage increased by 0.5% between Q2 and Q3 this year. Although our research revealed that wage growth numbers didn’t significantly change by industry since last quarter, they did continue to range from city to city.  For example, Seattle, San Francisco, and Boston continued to have positive growth, whereas Dallas, Houston, and Miami saw wages decrease between Q2 and Q3 2016.

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All that said, the Accommodation and Food Services industry surprised us. Despite ranking second-to-last in growth since we began tracking wages in 2006, this industry’s wages grew remarkably fast over the last three quarters, so much so that this industry became a top performer in both quarterly and annual growth at 3.6% and 1.3%, respectively.

Q3 2016 Trends in Canada

In Canada, the year-over-year growth is holding fairly constant; that said, Canada has had the highest growth of the three countries, growing 11.5% since 2006. Canada also sees some regional differentiation, especially in Ottawa-Gatineau which has seen 3.1% growth over Q3 2015.

Q3 2016 Trends in the United Kingdom

In the UK, year-over-year growth was also consistent and strong. The UK tied with the US, with wage growth increasing by 10.5% since 2006. Although not as high as Canada’s 11.5%, it’s still nothing to scoff at.  In the months ahead, we will keep an eye on how wages are impacted by Brexit.

Find the US, Canada, and UK indices in the Research Reports section of our Modern Compensation Hub. While you’re there, check our recent Skills on the Move report, which tracks hot skills in the market.

Joanna Mullally
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