ROSELAND, NJ -- (Marketwired) -- 10/18/17 -- According to the ADP Workforce Vitality Report, overall wage growth increased by 1.7 percent year over year across all industries in the third quarter of 2017 and is slower than the 2.6 percent growth in wages reported by the U.S. Bureau of Labor Statistics (BLS). The ADP Workforce Vitality Report tracks the same set of workers over time, which provides a more insightful picture of wage growth than overall wage growth. This set of workers includes job holders, who stayed in their same job for at least one year, and those who changed jobs, referred to as job switchers.
Job holders' wages grew by 4.4 percent and job switchers' wages grew slightly less by 3.3 percent year over year in the third quarter. On average, job holders' hourly wage levels were
|TABLE 1: Annual Wage Growth Q3 2017|
|Quarter||Wage Level||YOY Wage Growth|
Considering wages across industries, the service sector proved to be more attractive for job switchers than the goods sector. Across most service industries, job switchers' wage growth exceeded that of job holders. Full-time workers who switched jobs to the leisure and hospitality industry gained the most with a 6.9 percent increase in wages. Looking at those who stayed in their jobs, the information industry led the way in wage growth in the third quarter where job holders wages increased by 5.1 percent.
"Despite the deceleration we've been experiencing in overall wage growth we continue to see evidence of the strengthening labor market when you look at specific areas," said Ahu Yildirmaz, co-head of the ADP Research Institute®. "As employers strive to retain skilled workers, we see wage increases for full-time job holders in all sectors. Most notable are the information and construction industries."
|TABLE 2: Q3 2017 Annual Wage Growth by Industry|
|Industry||Wage Level Full-Time||YOY Wage Growth Full-Time||Yearly Employment Growth|
|Resources and Mining||4.7%||-1.5%||7.9%|
|Finance and Real Estate||4.5%||4.7%||1.8%|
|Professional and Business Services||4.4%||5.6%||2.7%|
|Leisure and Hospitality||4.8%||6.9%||2.8%|
|Education and Health Services||3.9%||6.2%||2.1%|
|Trade, Transportation, and Utilities||4.3%||4.0%||0.6%|
Looking at labor market dynamics across all regions there is some variability. The average wage level for job holders in the Midwest is the lowest of all four regions with a rate of
|TABLE 3: Q2 2017 Annual Growth by Region|
To summarize the trends across a variety of dimensions; the strongest wage growth can be found in the West, the leisure & hospitality and information industries, among women and younger workers, workers with little job tenure and those employed in large companies.
|TABLE 4: Who Fared the Best in Third Quarter: Annual Wage Growth for Job Holders|
|Age||24 and younger||8.8%|
|Tenure||Less than 3 years||5.4%|
|Industry||Leisure & Hospitality/Information||4.9%|
The 4th Quarter 2017 ADP Workforce Vitality Report will be released on Wednesday, January 17, 2018.
About the ADP Workforce Vitality Report
The ADP Workforce Vitality Report was developed by the ADP Research Institute in collaboration with Moody's Analytics. It is an unprecedented, in-depth quarterly analysis of the vitality of the U.S. labor market based on actual data that identifies labor market trends and dynamics across multiple dimensions. These dimensions include employment growth, job turnover, wage growth and hours worked. In addition to the macro data presented in the report, there are also segment-specific findings by industry, state, gender, age, experience, and pay level. For more information about the report, please visit http://workforcereport.adp.com/.
About ADP (NASDAQ: ADP)
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Source: ADP, LLC
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