According to comprehensive reports from WorldWay, Paul Dales, an economist at Capital Economics, commented on July 21 that while wage increases in the United States may not yet be very apparent, signs of recovery are emerging in certain sectors and regions.
Dales stated, “The cyclical growth of wages seems to be unfolding in some industries and regions of the U.S. economy. This indicates that the national unemployment rate's decline is triggering an acceleration in overall wage growth; it is just a matter of time.”
Data released earlier in July showed that the U.S. added 288,000 non-farm jobs in June, with the unemployment rate dropping to 6.1%; meanwhile, the average hourly wage increased by 0.2% month-over-month in June, and the year-over-year increase was 2.0%.
Dales pointed out that this is also a major reason why Capital Economics believes the Federal Reserve may raise interest rates earlier than generally expected. Currently, investors anticipate that the Federal Reserve will begin raising rates next summer. Last week, Federal Reserve officials Fischer and Bullard indicated that the Federal Reserve may need to raise rates sooner, possibly at the beginning of next year.
WorldWay Editor
