Today’s Must-Must-Read: Ben Zipperer: Weak U.S. Employment Gains and Wage Growth

…weak employment growth… not accompanied by strong hourly wage gains…. Over the last three months, the US economy has added a monthly average of 197,000 jobs… these job gains have not been sufficient to generate substantial wage growth…. In March…h the employed share of the population aged 16-to-24 years dropping to 48.2 percent from 48.9 percent. Until March the employment situation for younger workers had generally improved… but employment rates for the young still remain at historic lows….

Last month the hourly pay for workers in the private sector grew at a 2.1 percent annual rate compared to last year, and at an annual rate of 2.8 percent over the past three months…. The contrast is even sharper when looking back over the past six months… nonsupervisory wages have grown at an annual rate of about 1.8 percent…. For workers to maintain or increase their share of income, nominal wages must grow at an annual rate of at least 3.5 percent…. Since 1990, nominal wage growth sustainably exceeded the 3.5 percent threshold only when the prime-age employment rate remained above 79 percent. The employment-to-population ratio for prime-age workers in the past month was 77.2 percent…