As Wages Rise, Who Benefits More: Men or Women?

The country’s sustained economic growth is making itself apparent in women’s wages more than men’s, according to to the ADP Research Institute’s latest Workforce Vitality Report.

Since January 2019, female job holders are capturing larger wage gains than their male counterparts, according to Ahu Yildirmaz, co-head of the ADP Research Institute. “Female job holders received average wage gains of 5 percent, while men averaged wage gains of 4.6 percent,” she says.

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Overall, wages for U.S. workers grew 4 percent over the last year, increasing the average wage level by $1.09 to $28.54 an hour, according to the report. The growth, accelerating from 3.8 percent to 4.0 percent annual as of June 2019, was driven by strong wage gains for workers in the manufacturing (4.4 percent wage growth, $29.83 hourly wage) and construction (4.4 percent wage growth, $28.65 hourly wage) industries.

From the service sector, information (4.2 percent wage growth, $41.56 hourly wage), trade (4.3 percent wage growth, $25.27 hourly wage), which represents 22 percent of the workforce, and professional and business services (4.1 percent wage growth, $36.45 hourly wage) were the major contributing industries.

“The tight labor market is pushing companies to pay more,” says Yildirmaz. “As labor shortages are apparent in most of the sectors, the businesses are holding on to their skilled workers by increasing their wages.”

According to ADP, job switchers in the information industry continued to lead the way with a wage level of $41.08 and growth of 9.7 percent. Job switchers in professional and business services and construction also realized high wage growth of 8.3 and 8.7 percent, respectively. In trade, the largest sector, job holders experienced stronger growth in wages than the workers who switched to the industry, 5.2 percent versus 3.8 percent, but lagged in employment growth with only a mere 0.6 percent annually.

Workers in the Midwest outpaced other regions with 4.5 percent wage growth though the hourly wage rate was the lowest at $26.57 and lowest employment growth at 1.0 percent. Job switchers fared best in the West experiencing a wage growth of 7.3 percent. The workers in the South and Northeast had the lowest wage growth at 3.6 percent. By firm size, workers at large firms had the highest wage growth rate at 5.1 percent, with employment growth at 3.1 percent.

It’s certainly a far cry from less than a year ago, when we reported that wages were remaining flat for all workers despite the record-low unemployment rates.

Michael J. O'Brienhttp://
Michael J. O’Brien is former web editor with Human Resource Executive®.