Wages have been rising over the past couple of years but by less than inflation has risen, resulting in declining real wages. From January 2021 through February 2023, prices rose 14.8% and the average wage rose 10.6%. This produced inflation-adjusted wages that were 96.3% of their January 2021 level as of February.
During this same period, nonfarm employment has continued to rebound from the COVID Recession. From January 2021 to February 2023, employment rose 8.7% and employment is now 2.1% higher than its pre-Covid peak in February 2020.
Real wage changes and employment changes have not been uniformly distributed across the country, however, as seen in the dashboard below.
The dashboard presents an overview of the percent change in real average weekly wages and the percent change in nonfarm employment in the Metropolitan Statistical Areas (MSAs) between Quarter 3 of 2021 and Quarter 3 of 2022.
The data source is Quarterly Census of Employment and Wages (QCEW) : U.S. Bureau of Labor Statistics (bls.gov). While the data from the QCEW is delayed in its release, it shows the range of outcomes for different MSAs.
The top panel illustrates the geographic distribution of the percentage change between 2021:Q3 and 2022:Q3 in real average weekly wages. For this period, the median percent change in real weekly wages was -0.17% and the weighted average across the MSAs was -1.46%. The largest real wage declines primarily occurred on the west coast and in some MSAs in the New England states. The highest real wage increases were scattered across the country.
By hovering over an MSA, the counties included in that MSA will be listed in the panel to the right of the map. The pop-up box gives the MSA name, the percent change in employment, average weekly wages, and total wages from 2021:Q3 and 2022:Q3 along with the average weekly wage in 2022:Q3.
The bottom panel depicts the distribution of both the percent change in real average weekly wages and percent change in nonfarm employment. The distribution of the percent change in average weekly wages is skewed to the negative values and the reverse is true for nonfarm employment.
The bottom right section of the dashboard presents a four-quadrant graph. The graph divides the MSA’s into four groups depending on their location relative to the median percent change in average weekly wage of -0.17% and the median percent change in nonfarm employment of 2.9%. The weighted average increase in nonfarm employment across all MSAs was 3.8%. Each quadrant contains about the same number of MSAs.
MSAs in quadrant 1 have both higher employment growth than the median and higher real weekly wage growth than the median. Hovering over the markers reveals the MSAs’ names and highlights them in the map. Midland, TX and Odessa, TX have the highest positive percentage change in both the variables.
Quadrant 2 shows the MSAs where the percentage changes in nonfarm employment are less than the median, but where the percentage changes in average weekly wages are above the median. For example, employment in California-Lexington Park, MD fell 2.48% and average real weekly wages grew 3.55% from 2021:Q3 and 2022:Q3.
Quadrant 3 contains the set of MSAs in which both the nonfarm employment and average weekly wage percent changes are below the respective medians. Lake Charles, LA saw an employment decline of 2.23% and a decline in average real weekly wages of 3.62% from 2021:Q3 and 2022:Q3.
Lastly, quadrant four includes the ninety eight MSAs that have higher than the median percent change in nonfarm employment, but lower than the median percent change in average weekly wages. Real average weekly wages in San Francisco-Oakland-Hayward fell 14.16% from 2021:Q3 and 2022:Q3, but employment increased 4.83%.
High inflation that has outpaced wage gains continues to threaten the purchasing power of workers’ wages even as employment continues to rise. As the dashboard illustrates, employment and real wage changes varied across the country with some regions being harder hit than others. Wage and employment outcomes in coming months will indicate whether the regional pattern continues.
During this same period, nonfarm employment has continued to rebound from the COVID Recession. From January 2021 to February 2023, employment rose 8.7% and employment is now 2.1% higher than its pre-Covid peak in February 2020.
Real wage changes and employment changes have not been uniformly distributed across the country, however, as seen in the dashboard below.
The dashboard presents an overview of the percent change in real average weekly wages and the percent change in nonfarm employment in the Metropolitan Statistical Areas (MSAs) between Quarter 3 of 2021 and Quarter 3 of 2022.
The data source is Quarterly Census of Employment and Wages (QCEW) : U.S. Bureau of Labor Statistics (bls.gov). While the data from the QCEW is delayed in its release, it shows the range of outcomes for different MSAs.
The top panel illustrates the geographic distribution of the percentage change between 2021:Q3 and 2022:Q3 in real average weekly wages. For this period, the median percent change in real weekly wages was -0.17% and the weighted average across the MSAs was -1.46%. The largest real wage declines primarily occurred on the west coast and in some MSAs in the New England states. The highest real wage increases were scattered across the country.
By hovering over an MSA, the counties included in that MSA will be listed in the panel to the right of the map. The pop-up box gives the MSA name, the percent change in employment, average weekly wages, and total wages from 2021:Q3 and 2022:Q3 along with the average weekly wage in 2022:Q3.
The bottom panel depicts the distribution of both the percent change in real average weekly wages and percent change in nonfarm employment. The distribution of the percent change in average weekly wages is skewed to the negative values and the reverse is true for nonfarm employment.
The bottom right section of the dashboard presents a four-quadrant graph. The graph divides the MSA’s into four groups depending on their location relative to the median percent change in average weekly wage of -0.17% and the median percent change in nonfarm employment of 2.9%. The weighted average increase in nonfarm employment across all MSAs was 3.8%. Each quadrant contains about the same number of MSAs.
MSAs in quadrant 1 have both higher employment growth than the median and higher real weekly wage growth than the median. Hovering over the markers reveals the MSAs’ names and highlights them in the map. Midland, TX and Odessa, TX have the highest positive percentage change in both the variables.
Quadrant 2 shows the MSAs where the percentage changes in nonfarm employment are less than the median, but where the percentage changes in average weekly wages are above the median. For example, employment in California-Lexington Park, MD fell 2.48% and average real weekly wages grew 3.55% from 2021:Q3 and 2022:Q3.
Quadrant 3 contains the set of MSAs in which both the nonfarm employment and average weekly wage percent changes are below the respective medians. Lake Charles, LA saw an employment decline of 2.23% and a decline in average real weekly wages of 3.62% from 2021:Q3 and 2022:Q3.
Lastly, quadrant four includes the ninety eight MSAs that have higher than the median percent change in nonfarm employment, but lower than the median percent change in average weekly wages. Real average weekly wages in San Francisco-Oakland-Hayward fell 14.16% from 2021:Q3 and 2022:Q3, but employment increased 4.83%.
High inflation that has outpaced wage gains continues to threaten the purchasing power of workers’ wages even as employment continues to rise. As the dashboard illustrates, employment and real wage changes varied across the country with some regions being harder hit than others. Wage and employment outcomes in coming months will indicate whether the regional pattern continues.