Wage inflation: The jobs seeing the greatest pay increases, according to an economist

Emsi Burning Glass Chief Economist Ron Hetrick joins Yahoo Finance Live to discuss wage gains amid inflation and recession concerns.

影片文字轉錄稿

BRIAN SOZZI: Nonfarm payrolls rose by 431,000 in the month of March. But underneath the surface, where are wages are running the hottest? And Ron Hetrick is the chief economist at Emsi Burning Glass. Ron, good to see you this morning. So where are you seeing some of the biggest wage gains? RON HETRICK: We have to step back and look at this kind of job openings ratio. So if you look at our 11.3 million job openings, I'm estimating about 6.8 million are for jobs that do not require a college degree. And yet, we only have about 1.9 million of those people available. So if you do the math, you have a lot of demand for people who are probably in that sub $25 an hour job. So you can pretty much take your pick. Warehouse workers-- they've shot up dramatically over the past year up into that $19 an hour range. Even things like accounting clerks or retail sales clerks, people who work in fast food places, all of those jobs have jumped from $12 to $14, all the way up to $16 to $19 an hour. JULIE HYMAN: And so when you look at those kinds of increases, Ron, we've been talking a lot about how wage growth writ large has not been keeping pace with inflation. But for those jobs that you're talking about, have the wage gains actually been outpacing the rate of inflation? RON HETRICK: Yeah, I would say for some of the jobs. As an industry, leisure and hospitality is up 20%, with average weekly earnings in the past year. So I think they've been holding pace with it. But what's been interesting is jobs like in manufacturing have not been holding pace. We've seen kind of some stubborn resistance. Wages started to go up and then just simply haven't kind of maintained the same level of some of these other industries. So I would say yes, for the most part, for a lot of those sub $20 an hour jobs. But keeping up with the rate of inflation when you're already sub $20 an hour, that's also kind of some tricky math as well. BRIAN SOZZI: Ron, is $20 an hour, is that the new minimum wage? RON HETRICK: You know, I think that's a great question. What I'm starting to see is a willingness to hit that $18 an hour mark. So I'm kind of looking at that more as maybe where companies are starting to come in on a regular basis. You had companies like Amazon who set a standard there. They jumped out in front of the pack. But I think everybody else has kind of been catching up. You still see a lot of fast food and things like that kind of settling into that $15, maybe $16 an hour range. JULIE HYMAN: And what about so-called white collar jobs? What are we seeing in that arena in terms of wage growth? RON HETRICK: You know, it's been very interesting to watch this sector. I think there's something going on here. You know, I think we have white collar industries are kind of used to dealing with labor shortages. And so you've seeing some resistance. Let's use two jobs for an example. If I look at accountants and look at the past three years, their wages have bounced around a little bit, but they're relatively flat. Yet accounting clerks, you know, that lower skilled job, that's the one that's seen 12% to 15% wage increases. So I think there are certain industries maybe like finance and such that maybe aren't seeing that level of demand that the rest of them are. And you're seeing wages kind of holding steady. Where you see that exception are things like market research, data analytics. There's such a demand for those kind of skill sets, so you are seeing wages kind of jump up in those groups. But I will tell you this. There is still resistance above that above $25 mark, where you see professional jobs gaining where those ones that were around $20 to $25, they're starting to jump up, probably to create a little bit of distance between those jobs and the ones that do not require a college degree. BRIAN SOZZI: Lastly, Ron, do you see anything out there that would suggest that we could get a recession this year? RON HETRICK: Here's the way I've always looked at recessions. You know, everything, when you study historically recessions, they're always the result of something overheating and then correcting. You can go back to the housing market, the tech recession of 2001. We can't overheat because we do not have the employment to get us to overheat. Certainly, employers want to bring people in, but they're not able to bring them in. So you see things like new orders and unfilled orders skyrocketing, but yet industrial production remains flat. Why? Because we don't have enough people to follow these orders. So I think it's difficult to say we have a housing market that needs more houses. We have consumers who are looking for more product. And the industry simply can't deliver the amount of products that people need. So I think it's difficult to see a recession, given those dynamics. BRIAN SOZZI: Ron Hetrick, chief economist at Emsi Burning Glass, good to see you. Have a good weekend.