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PayScale Index: Wage Growth Slows in Q1

Wages in the U.S. grew 2.1 percent annually in the first quarter of 2017, according to the newly updated PayScale Index, but slowed from Q4 2016.

“The labor market is in transition from the post-election bump in Q4,” said Katie Bardaro, VP of Data Analytics and Lead Economist at PayScale. “The most recent Index shows positive results tempered by uneven growth by industry and geography. While it’s the seventh consecutive quarter of positive growth, the tepid increase lags inflation, keeping real wages 7 percent below those of 2006.”

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West Coast cities saw the best wage growth, with San Francisco, Los Angeles (tied with Charlotte), and San Jose leading the pack. Wages declined in only seven out of 32 metro areas: Phoenix, Minneapolis/St. Paul, Baltimore, Cleveland, Nashville, Austin and San Diego.

Where Wages Are Growing Most — and Least

The first quarter was solid for wage growth in most industries, with the exception of tech and real estate. Tech experienced negative wage growth since last quarter, while real estate had nearly flat quarterly wage growth. On the other hand, wages in the construction industry have been growing since mid-2013. Small companies with fewer than 100 employees saw the most wage growth last quarter while large companies saw the least.

Curious how wages differed for your area, industry, or set of jobs? Download the Q1 2017 U.S. PayScale Index.

Q1 2017 Wage Growth in Canada

The PayScale Index (Canada) shows slowing quarterly wage growth of 0.4 percent for Q1, after strong growth from Q3 to Q4 2016. Most metro areas were in line with national wage growth. The exceptions were Edmonton/Alberta and Montreal. The Q1 2017 Canada PayScale Index has more details about which metro areas were hot in Canada, and also uncovers how hot those areas were.

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Jen Hubley Luckwaldt
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