The Atlanta Journal-Constitution
Wages expected to warm up as payroll gains cool
Strong February hiring may ease concerns of expansion losing steam.
America’s jobs engine may have cooled a bit last month, but wages probably heated up as U.S. companies struggled to fill positions in a tightening market.
Nonfarm payrolls likely increased by about 180,000, a still-solid pace though down from 304,000 in the prior month, while the jobless rate fell a tenth of a point to 3.9 percent — near the lowest rate since 1969 — according to economists surveyed by Bloomberg ahead of Friday’s Labor Department report.
Average hourly earnings may have jumped 0.3 percent from the prior month to result in a 3.3 percent annual gain, matching the high since the last recession ended in 2009.
Strong hiring in February might ease growing worries that the expansion — which is poised to turn 10 years old July 1 and become the longest in U.S. history — is running low on steam amid slowing global growth, a trade battle with China, easing fiscal stimulus and higher interest rates.
“We will continue to see wages strengthen as the availability of labor gets tighter and companies are finally realizing they need to be paying up for that,” said Sarah House, senior economist at Wells Fargo & Co.
“The health of the labor market will largely determine the economy’s resilience to a short-term soft patch,” Bloomberg U.S. economists said. “Despite a temporary wobble in economic growth, Bloomberg Economics projects a solid February increase in hiring, further evidence of mounting wage pressures and a return to the downward trend in the unemployment rate.”