Reclaiming Common Sense

The May Employment Situation Report, or Jobs Report, was released to high praise for once. More "jobs" (Seasonally Adjusted Current Employment Statistics Workers) were added than "expected." Unemployment fell. The unadjusted unemployment rate was the lowest for May since 1969. Full-time Current Population Survey (CPS) jobs soared while NSA Part-time jobs dropped significantly.  Participation improved. The unemployment rate fell. More detail can be found in "Seriously Strong Full-time Job Gains This May." There is a considerable amount of discussion regarding wages. What happened with wages this morning?

Weekly Wages Improved for All CES Worker Super Sectors over the past year. We saw the weekly wages for every sector increase  for all but one sector by over  2.38%. This is good because CPI inflation was roughly the same amount this past month. The Average rate of growth was 3.08% and the maximum growth was 6.01% for the financial activity sector. 

All sectors except Information Technology added workers over the past year Worker growth is up by more than 1.5% for every sector except IT. The IT sector saw a drop in workers of 0.65%The largest growth gains were in Mining and Logging, Construction, Professional and Business Services, and Manufacturing. These four sectors  are four of the five highest paying sectors this month. IT is the the number four sector for average weekly wage.

The Seasonally Adjusted Data does not reflect this change. The Average Weekly wage during May 2017 was $901.62. This May it was $928.74.The "official" wage growth this month is 3.00% When the total wage value is divided by the total worker number the annual wage is $48,009 . The Average annual wage last year was $46,575. That is a total annual wage increase of 3.08%. ((Total Wage 2017/Total Worker 2017)/(Total 2018 Wage/Total 2018 Worker)) The difference is slight.

When wages increase and workers increase then the economy can increase.

It's the economy.