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PayScale Index Shows Q1 Wage Growth Stalling

Growth slows from Q4, marked by uneven geographic and industry distribution;
West Coast leads Q1 growth

Seattle, WA – April 11, 2017 – Today, PayScale, Inc., the leader in cloud compensation data and software for businesses and individuals, released the Q1 2017 PayScale Index, which tracks quarterly and annual trends in compensation and provides a U.S. wage forecast for the coming quarter.

The Q1 index shows mixed results for wages. While wages grew 2.1 percent annually in the first quarter of 2017, they did not outpace wage growth in Q4 2016. Q1 is the seventh consecutive quarter with wage growth, but real wages still lag behind 2006 wages when factoring inflation. Although many metro areas saw wage declines or slower wage growth, West Coast cities performed best in terms of Q1 wage growth, led by San Francisco, Los Angeles and San Jose.

“The labor market is in transition from the post-election bump in Q4,” said Katie Bardaro, Vice President of Data Analytics and Lead Economist at PayScale. “Our most recent Index shows positive results tempered by uneven growth across some industries and geographies. While it’s the seventh consecutive quarter of positive growth, the tepid increase lags inflation, keeping real wages 7 percent below those of 2006.”

Key findings from the Q1 2017 PayScale Index:

  • The construction industry was a leader sector in terms of year-over-year wage increases at 3.3 percent.
  • Retail jobs experienced a solid quarter-over-quarter increase of 2.0 percent. Construction and food service jobs also saw marked increases of 1.4 percent and 1.0 percent respectively. These changes are uncharacteristic in retail and construction jobs, but they fall in line with two years of particularly strong growth in food service jobs.
  • Due to exceptionally large quarter-over-quarter increases, wages in food service and construction jobs saw the largest year-over-year increases (3.7 percent and 3.3 percent, respectively).
  • Only seven of the 32 metro areas examined saw quarter-over-quarter declines in wages: Phoenix, Minneapolis/St. Paul, Baltimore, Cleveland, Nashville, Austin and San Diego.
  • Highlights of Canadian wage growth in Q1:
    • After particularly strong quarter-over-quarter growth from Q3 2016 to Q4 2016, wage growth nationally in Canada slowed somewhat to 0.4 percent.
    • Most metro areas reflected the national trend. The exceptions were Edmonton, Alberta which experienced strong growth at 2.1 percent and Montréal where wages decreased 1.3 percent. These changes seem to be consistent with previously observed variability, so we will monitor this trend to see if it persists in future quarters.

To view the entire interactive Q1 2017 PayScale Index which reflects wage trends across various industries, job categories, company sizes and major metros, including Canada, please visit:

About the PayScale Index:
The PayScale Index follows changes in total cash compensation for full-time, private industry employees in the U.S. and Canada. The PayScale Index also includes:

  • A PayScale Real Wage Index, which tracks changes in wages adjusted for inflation since 2006

For more information on The PayScale Index, please visit the methodology and FAQ pages.

About PayScale:
PayScale offers modern compensation software and real-time, data driven insights for employees and employers alike. More than 6,000 customers, from small businesses to Fortune 500 companies, use PayScale to power pay decisions for more than 13 million employees. These companies include Dish Network, Getty Images, Skullcandy, Bloomberg BNA and Time Warner. For more information, please visit: follow PayScale on Twitter:

Press Contact:
Phyllis McNeice
Tel: 206-954-1481

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