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PayScale Index Offers Glimmer of Hope for Higher Pay as Wage Growth Outpaces Predictions

Recent Index shows national wages increased more than expected in late 2015 and real wages may be rebounding
Recent Index shows national wages increased more than expected in late 2015 and real wages may be rebounding

Seattle, WA – January 5, 2016 – Today, PayScale Inc. – the leader in cloud compensation data and software for businesses and individuals – released the Q4 2015 PayScale Index, which tracks both quarterly and annual trends in compensation and also provides a U.S. national wage forecast for the coming quarter. In the last quarter of 2015, U.S. wages across all industries exceeded expectations by a significant margin; a promising sign for workers’ wages after years of stagnation. The PayScale Index predicted quarterly growth of 0.1 percent and annual wage growth of 0.6 percent in Q4, however, wages actually rose 1.1 percent in the quarter and the average 12-month increase was 1.5 percent.

“Our economy has produced a bleak landscape for wages across almost every industry since the recession,” said Katie Bardaro, Lead Economist at PayScale. “While wage growth was still tepid in Q4, it was encouraging to see that U.S. wages exceeded expectations and that real wages showed signs of improvement. We’ll watch closely to see whether this positive trend continues into 2016.”

Key findings in the Q4 2015 PayScale Index

  • Real wages improve, but wages still buy less today than in 2006:
    • Although real wages are down almost 7 percent since 2006, the measure reflects 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.
  • Wages rose for STEM-focused jobs:
    • Although wages for IT jobs fell for the first two quarters of 2015, they picked up once again in Q4, growing 1.3 percent for the quarter and 1.2 percent annually.
    • In addition to IT jobs, wages in other STEM positions also recovered from a major dip in the first half of 2015 with 0.8 percent annual wage growth for engineering jobs and 1.1 percent annual wage growth for science and biotech jobs.
  • Wages continue to rise for the real estate and construction industries:
    • Both the construction and real estate industries saw a major downturn after the recession and wages experienced some ups and downs in 2014 and early 2015.
    • However, annual wages for these industries showed encouraging signs of life in Q4. Quarterly wages grew 0.7 percent in construction and 0.9 percent in the real estate industry.
  • Wages for Mining, Oil and Gas Exploration industry rebounded:
    • Wages for this industry fell the first three quarters of 2015, then rose in Q4 with 1.6 percent annual wage growth. However, the Q4 increase wasn’t enough to overcome the dips earlier in the year, as annual wages for the industry were a meager 0.2 percent.
    • Annual wages in Houston, a city dominated by the oil industry, fell by 0.9 percent last quarter.
  • Highlights for U.S. Metro wage growth include:
    • The top five U.S. metro areas experiencing the most annual wage growth were:
      • San Francisco, CA (2.5 percent)
      • Chicago, IL (1.9 percent)
      • Riverside / San Bernardino, CA (1.9 percent)
      • Washington, DC (1.8 percent)
      • St. Louis, MO (1.8 percent)
    • The three U.S. metros experiencing the least growth in annual wages were:
      • Philadelphia, PA (0.4 percent)
      • Phoenix, AZ (0.0 percent)
      • San Diego, CA (-0.4 percent)
  • Positive Canadian wage growth:
    • Similar to the U.S., most measures showed positive wage growth in Canada, as the country experienced 1.2 percent annual wage growth nationally.
    • The oil town of Edmonton, Alberta experienced Canada’s highest positive wage growth in Q4 as quarterly wages grew 2.5 percent and annual wages increased 0.7 percent. As a result, wages in Edmonton have recovered from the dip in early 2015.
  • Strong wage growth in the United Kingdom:
    • In the second half of 2015, wages in the U.K. rebounded from a period of stagnation and the quarterly measure showed an increase of 0.9 percent in Q4.
    • Wages in the U.K. have grown by 9.7 percent since 2006, tied with the U.S. and lagging behind Canada (12.1 percent).

To view the entire interactive Q4 2015 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 Q1 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:

As the industry leader in compensation data and technology, PayScale helps organizations #getpayright. PayScale is the only technology solution for managing compensation that provides multiple streams of fresh, transparently curated, and validated salary data. Combined with modeling engines that learn continuously and generate recommendations and insight, PayScale empowers HR to price jobs and adjust compensation to reflect near real-time changes in the market — all on one trusted data platform. With PayScale’s Adaptive Compensation Advantage, teams operate with efficiency, focused on outcomes rather than manual data management. To learn how companies like The Washington Post, Perry Ellis International, United Healthcare and The New York Times rely on PayScale to attract and retain top talent, engage employees and plan their future workforce, visit

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