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But, this is good news. In 2009, many job’s income’s plummeted under the weight of high unemployment, low consumer spending and minimal inflation. But, this plummeting stopped in 2010 for nearly everyone, and there were even a few glimmers of hope for wage increases in 2011.
The PayScale Index goes back as far as 2006 and looks at wages trends for full-time, private-sector employees in 20 metro areas, 15 industries and three sizes of companies. If you look at the national trends over the course of the Index, you can see the healthy wage gains in 2007, the damage done by the recession as pay dropped in 2008 and 2009 and then finally the flat line in 2010.
What Happened to Wages in 2010?
PayScale’s close up view of 2010 found the following: Wage levels at the end of 2010 were no higher than they were nearly three years ago, although the cost of goods has increased, causing an overall reduction in consumer buying power. Wages have risen 0.3% since Q4 2007, while core inflation has increased by 4.5% in the same period.
"2010 was a year when the economy really did not move up or down, rather it moved sideways. Mirroring the stubbornly high unemployment, pay was virtually unchanged in 2010, down 0.1% nationally in Q4 2010 versus the year before. While better than the declining pay of 2009, it was a long way from the ‘normal’ annual increases of three percent or more before the great recession,” says Al Lee, director of quantitative analysis at PayScale.
What else did The PayScale Index uncover by the end of 2010?
• Wages for workers at small companies (0-99 employees) fell throughout 2010. They ended the year a full percentage point lower than they were a year earlier. This is a cause for concern as small companies generally have more flexibility to set wages in response to short-term trends than larger companies.
• In Q4 of 2010, earnings for construction workers hit their lowest point in three and a half years. Their earnings were down 1.5% from just a year ago.
• Mining, oil and gas exploration was one of the few industries to see a growth in wages in Q4 2010. Earnings in this industry were up 0.8% from the previous year. This was not a robust wage recovery, but it was better than the drops seen in other industries.
• Earnings for healthcare workers have remained basically flat for the last two years. During this time, wages have dropped, at most, a little over 0.5% from their peak in early 2008, which is much better than nearly every other industry.
• Like the country as a whole, manufacturing workers’ wages have not changed in more than a year. Q4 2010 showed no recovery as manufacturing incomes were exactly where they were 12 months earlier.
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