Industries with the Best Wage Growth

By Bridget Quigg
As the economy perks up, wages in many industries are reviving, some faster than others. There are steady earnings improvements in strong sectors, like healthcare, but what about the beleaguered finance and insurance industry? Wages there are actually showing signs of life, too, according to research from online salary database PayScale.com.

PayScale recently released its Q1 results for The PayScale Index, a quarterly analysis of wage increases and decreases by industry, metro area and company size. The PayScale Index reviews earnings data all the way back to 2006 and tracks the rate change in total compensation (salary, bonuses, tips, etc.) of full-time, private workers.

No single group of workers is enjoying large wage increases yet, but at least some employees' earnings are recovering from the dip suffered during the recession. Al Lee, PayScale’s director of quantitative analysis, says, “The overall message is that some areas of the economy are pulling out of their slumps and giving us the first strong signs of recovery.”

Of the 15 industries included in The PayScale Index, 11 showed improving wages over the last 12 months. The following is a list of the industries with the most rapid growth in workers’ income and the percentage increase in the last year.

1. Business Operations Support Services (1.0% growth)

The business operations support services industry covers outsourcing services of all kinds: HR functions, janitorial work, accounting, payroll and more. Lee points out that recruiters are included in this group and they are recovering from a very devastating hit during the recession. “If you were a recruiter in 2009, you basically didn’t have a job. Companies are starting to hire again now,” says Lee.

Lee continues, “Companies are less panicked so they are trying to tighten up their operations, which leads to greater demand in this sector.”

Quarterly Compensation Trends for Business Operation Support Services
The PayScale Index uses 2006 average total cash compensation as a baseline.
Business Operation Support Services
National (US)
Get a Free Salary Report
Compensation Data Provided by PayScale, Inc.


2. Wholesale Trade (0.8% growth) and Manufacturing (0.5% growth)

Both of these industries’ are greatly affected by consumer habits, though neither of them sell to consumers directly.

The wholesale trade industry includes wages for people running warehouses or buying products as importers, but not selling them directly to consumers. Regarding wholesale trade, Lee says, “This is an area of the economy that was hit harder than the rest of the economy by the recession. People stopped buying stuff. Now wages are moving back into line with national wage trends as people are buying again.”

Results for the manufacturing industry are greatly affected by activity in the auto industry, with smaller manufacturing companies being an important factor, too. In 2010, manufacturing enjoyed “a stark change from 2009 when two of the big three US car companies went bankrupt,” says Lee. An especially bright light for manufacturing in 2010 was that Ford reported a profit of $6.6 billion and shared that wealth in the form of bonuses for employees.

Quarterly Compensation Trends for Wholesale Trade
The PayScale Index uses 2006 average total cash compensation as a baseline.
Wholesale Trade
National (US)
Get a Free Salary Report
Compensation Data Provided by PayScale, Inc.


Quarterly Compensation Trends for Manufacturing
The PayScale Index uses 2006 average total cash compensation as a baseline.
Manufacturing
National (US)
Get a Free Salary Report
Compensation Data Provided by PayScale, Inc.


3. Utilities (0.6% growth) and Mining, Oil & Gas Exploration (0.5% growth)

Wages in both utilities and oil & gas exploration are dominated by what’s happening in the energy sector and the price for energy – oil, gas, coal - is soaring worldwide. This wealth is reflected in increasing pay levels.

“Workers in these industries had wages that were climbing rapidly before the recession and then were hit a bit more than average during the recession. Now, they are bouncing back again. Energy remains a hot sector worldwide,” says Lee.

Quarterly Compensation Trends for Utilities
The PayScale Index uses 2006 average total cash compensation as a baseline.
Utilities
National (US)
Get a Free Salary Report
Compensation Data Provided by PayScale, Inc.


Quarterly Compensation Trends for Mining, Oil & Gas Exploration
The PayScale Index uses 2006 average total cash compensation as a baseline.
Mining, Oil & Gas Exploration
National (US)
Get a Free Salary Report
Compensation Data Provided by PayScale, Inc.


4. Finance & Insurance (0.5% growth)

The burgeoning health in the finance and insurance sector is another comeback story. It was an industry that was “beat up during the crisis, the finance sector being at the center of the downfall,” says Lee. It has now caught up with, and even may be surpassing, the national average wage increases since before the recession. “Banks are turning around in terms of profitability and have some flexibility in wages.”

Quarterly Compensation Trends for Finance & Insurance
The PayScale Index uses 2006 average total cash compensation as a baseline.
Finance & Insurance
National (US)
Get a Free Salary Report
Compensation Data Provided by PayScale, Inc.


5. Healthcare (0.5% growth)

According to The PayScale Index, wage increases in the healthcare industry were outpacing the national pay trends before the recession. Then, when the recession came, pay didn’t really go down. It dipped slightly but didn’t drop as much as the rest of the country.

“Healthcare remains a huge growth industry in this country. The pressures of demand are coming back and the workers are starting to get some raises,” Lee says. Lee points out that these are not the three percent annual raises seen before the recession, but they are positive and should continue as long as the economy keeps growing.

Quarterly Compensation Trends for Healthcare & Social Assistance
The PayScale Index uses 2006 average total cash compensation as a baseline.
Healthcare & Social Assistance
National (US)
Get a Free Salary Report
Compensation Data Provided by PayScale, Inc.


Comment




  1. Please prove to us that you're not a robot: