Wages and salaries for private-sector workers grew 1% in the second quarter of 2023, the smallest increase since the second quarter of 2021, according to data from the Employment Cost Index (ECI) released by the Bureau of Labor Statistics (BLS) on Friday. 

Salary increases were smaller than the 1.2% increase in the first quarter of the year and well below the record high 1.6% pay increase they got in the third quarter of 2021. Wage increases over the last 12 months added up to 4.6%, down from the 5.3% annual raise in the same quarter last year.

The report contributed to signs that workers are losing some of the bargaining power they’ve enjoyed over the past two years as emploꦗyers have c💜ompeted for relatively scarce workers. While the unemployment rate has stayed low, 澳洲幸运5官方开奖结果体彩网:hiring has slowed, and job openings, while still plentiful, 澳洲幸运5官方开奖结果体彩网:have been on a downward trend. 

This indication of slowing wage growth was cheered by many economists as another 澳洲幸运5官方开奖结果体彩网:encꦗouraging sign that inflatꩵion is falling beca🦄🃏use labor costs contribute to consumer prices, especially for services.

The report also may please officials at the Federal Reserve, who have been attempting to slow the economy—and wage increases—with a 澳洲幸运5官方开奖结果体彩网:campaign of interest rate hikes to bring inflation down to its 2% goal. Slowing wage growth may encourage officials at the Fed to leave rates steady when the central bank’s policy-setting 澳洲幸运5官方开奖结果体彩网:Federal Open Market Committee ꦚ(FওOMC) next meets in September, economists said. 

“The FOMC probably will want to see the recent trend sustained before it feels confident that inflation is firmly on its way back to 2%, but today's report is overall encouraging for achieving this goal,” Sarah House and other economists at Wells Fargo Securities wrote in a commentary.

The 1% quarterly pay raise was more than almost any month before the pandemic since the BLS began collecting data in 2001. And, crucially, the wage increase was greater than the 0.6% increase in inflation over the same quarter, as measured by the Consumer Price Index (CPI), meaning that the buying power of paychecks is staying ahead of inflation. 

Officials at the Federal Reserve watch the ECI closely, and 澳洲幸运5官方开奖结果体彩网:economists consider it a more reliable indicator of wage growth than average wages reported in the Bureau of Labor Statistics' widely watched monthly jobs report because it’s adjusted to account for the composition of the workforce, or who is gaining and losing jobs.

Unlike the ECI, the averages in the jobs report can be skewed by changes in t💙he makeup of the workforce: For example, average wages soared in April 2020 when the pandemic hit, not because of massive raises but because millions of lower-wage front-line service workers lost their jobs.