A specific group of American workers is experiencing their fastest wage growth in over three years by changing employers. According to a report from the Bank of America Institute, while overall pay growth for U.S. workers has slowed down, lower-paid hourly workers who jump ship are reaping major financial benefits. In July, the three-month moving average wage increase for job changers hit a three-year high of 12.5%. Although these pay bumps for switching jobs remain below pandemic-era levels, economists find the acceleration in wage growth among lower-paid workers encouraging. Bank of America Institute economist Taylor Bowley noted that this strong jump in pay suggests a pickup in earnings for lower-income workers alongside increased mobility among those paid by the hour. This trend is contributing to a narrowing of the traditional pay differential between lower-income and higher-income workers. Data showed that lower-income households experienced a 4.7% year-over-year rise in after-tax wages in August, compared to a 3.5% increase for higher-income households. Despite this positive momentum, experts emphasize that faster wage growth does not mean these workers are fully flourishing, especially as many remain concentrated in sectors like leisure, hospitality, transportation, warehousing, and retail. Separate research indicates that while higher-income earners typically maximize gains by staying with their current employer, younger or lower-paid workers achieve significantly better wage increases by moving to new companies.
Source: cbsnews.com
