Wage Growth Is Slowing Sharply in US Job Postings

• Wage growth in US job postings has been softening for more than a year now, and at the current rate, it could return to pre-pandemic levels by early 2024, according to Indeed Hiring Lab.
• Advertising wages rose 5.3% in May from a year earlier, a marked decline from the peak of 9.3% in January 2022. The slowdown has affected various industries, but it’s been particularly pronounced in low-wage sectors – for the type of positions that saw the biggest gains as the economy recovered from the pandemic.
• At this current rate of deceleration, wage growth would return to its 2019 average of 3.1% late this year or early 2024. Among the sectors that are seeing a sharp pullback is the software industry, which has been through waves of layoffs in recent months following a hiring spree at the height of the pandemic. Across now riding to Indeed data, job postings in that sector dropped by almost 60% over the past year, and advertised growth is now less than half of what it was last November
• Other data has shown pullbacks in earnings growth. The Atlanta Fed’s wage growth tracker dropped to 6.1% in April after peaking at 6.7% last June.

(Source: Bloomberg)