Workers have some good news to rejoice about: Economists reported that their companies are granting more pay raises this year. In a survey by the National Association for Business Economics (NABE), 43 percent of economists said that their firms have increased wages in the last three months. The number is up from last years, when only 19% of economists reported wage gains.
Although not every worker will benefit from a pay wage, trends indicate that the tide of cutting wages might be done. In the survey, no one reported pay cuts at their firm, and 57% reported that wages were flat. Looking forward, 35% of economists anticipate that their firms will raise wages in the next three months with others expecting wages to stay the same.
Although the survey is certainly encouraging, other day demonstrates that wages are rising but not enough to keep up with rising prices. According to the Bureau of Labor Statistics, when inflation is factored into the equation, the “real wages” were actually 0.1% lower in May, than they were a year earlier. The data provided by the Bureau of Labor Statistics is more comprehensive than NABE’s survey, including about 144,000 businesses and government agencies nationwide.
Federal Reserve Chair Janet Yellen recently stated that she would like to see wages rise faster than inflation this year so that households will be able to experience a legitimate increase in their take-home pay. At a press conference in June, she was quoted saying, “If we were to fail to see that, frankly, I would worry about downside risk to consumer spending.”
The Bureau of Labor Statistics is scheduled to release more information and data on inflation and earnings sometime today.