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PayScale Index Shows Positive Wage Growth with a Few Bright Spots in Q1

In Q1 2016, the PayScale Index illustrates how tech spurred wage growth in STEM-heavy cities and that the oil and gas crisis is definitely not over.

Seattle, WA – April 1, 2016 – Today, PayScale, Inc., the leader in cloud compensation data and software for businesses and individuals, released the Q1 2016 PayScale Index which tracks quarterly and annual trends in compensation and also provides a U.S. national wage forecast for the coming quarter. In the first quarter of 2015, U.S. annual wage growth was largely positive with growth for various industries ranging from 4.6 percent (transportation jobs) to -2.2 percent (marketing and advertising Jobs). However, overall wage growth was still tepid, as quarterly growth in Q1 was 0.2 percent and annual growth was 1.8 percent. The PayScale Index predicts wage growth in Q2 2016 will experience a slight downtick of -0.2 percent, resulting in annual wage growth of 2.0 percent.  

“Most measures for Q1 2016 show positive wage growth across many industries and job families,” said Katie Bardaro, Lead Economist at PayScale. “However, most of the data from the Q1 Index reports less than three percent annual wage growth which means, overall, wage growth for most jobs in the U.S. still remains relatively flat.”

Key findings in the Q1 2016 PayScale Index

  • Tech centers experienced strong growth:
    • Metros with a high prevalence of STEM workers performed well this quarter, with Seattle topping the list of metros for annual wage growth at 3.6 percent and quarterly wage growth of 1.8 percent.
    • Other STEM heavy metros did well this quarter as well:  Minneapolis had the second highest annual growth at 2.6 percent and San Francisco tied for third with 2.4 percent.
    • Wage growth in these metros may be driven by an increase in the number of data-focused positions – such as data scientists, data mining engineers or business intelligence analysts – which have experienced very strong wage growth over the last few quarters.
  • Wages continue to rise for transportation jobs:
    • Once again, transportation jobs topped the list for the highest annual wage growth at 4.6 percent; more than a full percentage higher than the next job family, installation, maintenance and repair jobs.
    • Similarly, the transportation industry also had a strong quarter for annual wage growth at 2.4 percent.
  • Wages for mining, oil and gas exploration dipped in Q1:
    • After some wage recovery in Q4 2015, wages once again fell in Q1 2016, dropping 1.8 percent from Q4 2015 for an annual decrease of 0.7 percent; the lowest of any industry.
    • Being an oil city, Houston was at the bottom of the metro list for annual wage growth with 0.0 percent growth. In addition, quarterly wages in the city dropped by 1.4 percent, which was the lowest of any metro.
  • Highlights for U.S. metro wage growth include:
    • The top five U.S. metro areas experiencing the most annual wage growth were:
      • Seattle, WA (3.6 percent)
      • Minneapolis, MN (2.6 percent)
      • Detroit, MI (2.4 percent)
      • San Francisco, CA (2.4 percent)
      • Atlanta, GA (1.9 percent)
    • The three U.S. metros experiencing the least growth in annual wages were:
      • New York, NY (0.7 percent)
      • Phoenix, AZ (0.6 percent)
      • Houston, TX (0.0 percent)
  • Positive Canadian wage growth:
    • Similar to the U.S., most measures showed annual positive wage growth in Canada.
    • The exception was the oil city of Edmonton where quarterly wages fell 1.4 percent and annual wage growth was down 0.8 percent.
  • Flat wage growth in the United Kingdom:
    • Quarterly wage growth in Q1 2016 experienced a slight increase of 0.1 percent, which resulted in annual wage growth of 1.8 percent.
    • Wages in the U.K. grew by 9.9 percent since 2006, tied with the U.S. and lagging behind Canada (12.1 percent).
  • Wages still buy less today than in 2006:
    • Real wages are down 6.5 percent since 2006, reflecting an improvement over the past three years during which real wages reached a low of more than 8 percent.
    • PayScale real wages are calculated by analyzing nominal wage growth and the average change in price of a fixed basket of goods and services.

To view the entire interactive Q1 2016 PayScale Index which reflects wage trends across various industries, job categories, company sizes and major metros, 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., Canada and the U.K. The PayScale Index also includes:

  • A forecast of the National U.S. PayScale Index for Q2 2016
  • 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:

Cloud software, crowdsourced data and unique algorithms power the world’s largest real-time database of rich salary profiles giving PayScale the unique ability to provide employees and employers alike immediate visibility into the right pay for any position. PayScale’s cloud compensation software is used by more than 3,500 customers including Bloomberg BNA, Cummins, Warby Parker, Clemson University and Signature HealthCARE. For more information, please visit: or follow PayScale on Twitter:

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