Americans switching jobs are getting bigger raises than employees staying put, with companies in technology and construction giving the largest pay hikes to those willing to take new positions amid a historically tight labor market.
Workers who switched jobs from one month to next saw average wage growth of 5.3% in June from a year earlier, near the best pace in almost five years of data and outpacing the 4% gain for all private employees, a fresh high, according to an ADP Research Institute report released Wednesday.
Job switchers in the information industry led the way with 9.7% annual wage growth, followed by an 8.7% jump for construction workers and 8.3% for professional and business services. Leisure and hospitality was the only major industry group with falling wages for switchers.
The private report is the latest sign of a solid labor market as unemployment holds near a half century low and job openings remain near a record and exceed the total number of jobless.
“The tight labor market is pushing companies to pay more,” Ahu Yildirmaz, co-head of the institute, said in the report. “As labor shortages are apparent in most of the sectors, the businesses are holding on to their skilled workers by increasing their wages.” – BLOOMBERG