Average hourly earnings were up 0.5% month-over-month in this month’s January jobs report. Year-over-year wages are up 2.2%.
That’s the biggest jump in wages since November 2008.
That’s after a disappointing December. Last month’s report showed that average hourly earnings declined month-over-month by 0.2%, the first decline since July 2013.
The question here, of course, is whether this big number represents an acceleration in wage growth, or if it’s just volatility after the disappointing number last month. Jobs numbers are incredibly noisy.
Economists surveyed by Bloomberg were looking for 0.3% month-over-month growth in January.
Deutsche Bank’s Joe LaVorgna expected 0.2%.
“Most importantly, we are interested to see if the unexpected drop in December average hourly earnings (-0.2%) is revised away, which is possible,” he wrote in a note this week. “Thus far, wage pressures have been largely muted. However, we doubt wage inflation will remain contained much longer if the labour market continues to generate 200k-plus monthly payroll gains alongside weak productivity readings.”
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