These two stories both ran on the same day. First is the Wall Street Journal:
Pay for new hires is starting to shrivel after years of hefty salary bumps, requiring workers to reset what financial gains to expect from switching to a new job.
Wages, especially for people who changed jobs, climbed in recent years as companies competed for workers to fill pandemic-induced labor shortages. Now, as the job market cools and businesses become more cautious in their hiring, many companies are paying new recruits less than they did just months ago—in some cases, much less.
When employers deliver a job offer, it had better come with some teeth: Americans’ wage expectations have hit record highs, according to a Federal Reserve Bank of New York survey released Monday.
Job seekers’ average reservation wage — the lowest pay they’d be willing to take for a new job — climbed to $78,645 in July 2023, up nearly 8% from July of last year.
So . . . apparently workers are demanding more—a lot more—and employers are offering less—a lot less. This doesn't strike me as a stable situation. Something has to give, and I suspect it's going to be workers.
Alternatively, both of these stories are standard business press bullshit—the former because it relies on unreliable data from the likes of ZipRecruiter and Gusto, and the latter because it's based on a survey instead of something from real life. I report, you decide.
Alternatively, both of these stories are standard business press bullshit...
Yep.
It has been fascinating watching the dueling stories about how work from home is the new normal and here to stay, or already gone. I assume this is some combination of clickbait and a reporter transcribing whatever propaganda is being fed to him.
I have come to realize that the most trustworthy branch of modern journalism is the sports page. It has its issues, of course, but it would be truly surprising to see it wrong about the basic facts, and it is pretty open about it when it is engaging in speculative BS. The business or *shudder* tech press are nowhere near as reliable.
Sports fans, being (mostly) grounded in the real world, are harder to convincingly lie to, than monetary economists. The latter, I'm convinced, went into their profession precisely because there are no hard measurables, and they can therefore wave their hands and BS to their heart's content, without having to worry about being proven to be wrong, or idiots.
I don't see a contradiction, or a media error.
Prices at the grocery store are higher than three years ago despite inflation coming down, and new hire wages are higher than they were three years ago despite the rise in new hire wages flattening.
People who stayed in the same job throughout the pandemic didn't see wage increases, so if they go to find another job it will likely contain a significant bump because wages are higher now for new hires.
So what is happening is that the wages for new hires are no longer rising quickly, but people who go for a new job after a number of years in another will still be experiencing a significant bump.
The chart provided in the WSJ article depicts unbelievably large pay decreases in major industries.
20-50% pay cuts for new hires in transportation/storage, business, arts/entertainment and manufacturing? This data cannot be accurate.
There's no contradiction, it just sounds like the "pay bumps" for new hires was artificially high and has returned to the mean. Incidentally I will take much less than $78k to work for somebody.