Research Weekly - Wage Growth, Utah vs. The Nation
US wage growth has yet to return to pre-recession levels, but after almost five years of fairly flat growth, in 2015 and 2016 we’ve begun to see more positive increases. This is largely due to lowered unemployment rates creating greater demand for labor coupled with continued economic growth. When there are fewer people that are unemployed, it is more difficult for employers to find qualified candidates. This encourages them to offer higher wages in an attempt to attract the needed labor, causing wage increases.
For the past five years Utah has experienced slightly less wage growth on average than the national average, but as the nation has seen an uptick in wage growth, so too has Utah. By the end of 2015 US wage growth was 3.1% compared to Utah’s 4.7%.
Utah’s unemployment rate has been increasing the past few months which may be a sign that wage growth will stall again due to lessened demand for labor, but with the economic stability we have recently seen and the quick market rebound after the Brexit vote, we may be able to expect continued wage growth as well. Although Utah’s wage growth appears to be much more erratic than the nation when looking at the graph below, this is simply because national growth is the average of all states, which demonstrates less variation than an individual state.