Americans Workers Seeing Biggest Pay Hikes in Years
US workers/consumers said they expected to see the fastest wage growth in several years when polled in January, according to a monthly Federal Reserve Bank of New York survey.
Consumers polled expected earnings to rise 2.73% in the coming year, the most since data collection began in Y 2013, according to results of the New York Fed’s Survey of Consumer Expectations released on Monday.
January was only the 3rd month in the survey’s 56-month history in which expected hourly pay growth topped expected consumer price inflation, which fell slightly, to 2.71%.
The data align with a 2 February Labor Department report which showed that US average hourly earnings rose 2.9% from a year earlier in January, marking the fastest pace of the economic expansion.
Fed officials are looking for clues about whether or not pay growth will continue to accelerate, and eventually put upward pressure on consumer prices, as they contemplate raising interest rates 3X this year under new Chairman Jerome Powell.
Results of the New York Fed poll also showed 39% of consumers felt their personal finances are in better shape than a year earlier, and 46% expected to be in better shape in a year, both marking the highest levels in data from Y 2013.