The July jobs report, released by the BLS last Friday, shows that wages (specifically average hourly earnings) are now growing at their fastest rate since the end of the great recession. The number most often cited was 2.6% year-on-year growth rate for both June and July. That figure is based on the seasonally adjusted series supplied by the BLS. I prefer to use the unadjusted series, and to smooth out its monthly volatility with a three-month moving average, and then calculate year-on-year growth (labeled as “3moMA %ch YoY” in the graph below). The results are very similar, with June and July showing post-recession high growth rates of 2.8%.
When we look at average weekly earnings, however, while the growth rates are the same for June and July at 2.8% (as above, that’s the year-on-year growth rate of the three-month moving average), this is not a post-recession high. Weekly earnings growth is stuck in the same range it’s been in since 2011:
Here’s another graph showing the both hourly and weekly earnings growth (again, the year-on-year growth rates of the three-month moving average):
The difference, of course, is explained by average weekly hours worked, also included in the BLS’s jobs report. While average weekly hours has been between 34 and 35 since mid-2011, the year-on-year growth rate has been negative for most of 2016 as the below graph shows.