Wage Pressures in the Labor Market: What Do They Say?
Summary:
Wage pressures among the newly employed in low-wage service occupations appear to be the result of normal economic forces, likely reflecting demand surges for—and a reluctant supply of—workers in occupations particularly hard hit by pandemic-induced economic shutdowns.
Key findings:
- There is evidence of significant wage pressures among low-wage service occupations.
- A combination of surging demand and reluctant supply appears to be driving current wage pressures.
- It's too soon to know if wage pressures will expand to other occupations.
The Center for Human Capital Studies
JEL classification: J2, J3
Key words: Labor demand, labor supply, reservation wage, COVID recovery, inflation pressures
https://doi.org/10.29338/ph2021-05
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