For years after the 2008 financial crisis, growth in average hourly earnings stayed low, hovering at around 2% year over year.
This was most likely not high enough to support the Fed’s stated inflation target of 2% year-over-year.
However, 2016 saw wages climb at a somewhat faster rate, with average hourly earnings growing in a range of 2.2% to 2.6% year-over-year, hitting a post-recession high of 2.9% in December.
According to the February jobs report, average hourly earnings grew by 2.8% from the prior year, well above the disappointing 2.5% rate in January and coming in line with economists’ expectations.
- Business Insider/Andy Kiersz, data from Bureau of Labor Statistics