What Slower Wage Growth Might Mean for a Strong Labor Market

Average hourly earnings for residential building workers continued to rise in August, but at a much slower rate than during the months prior, NAHB Eye on Housing reports. While labor demand remains elevated, employers are becoming increasingly cautious about hiring amid rising interest rates and economic uncertainty. The latest Bureau of Labor Statistics (BLS) report revealed that average hourly earnings (AHE) for residential building workers rose 3% to $29.32 in August from $28.45 one year ago.

This was 16.8% higher than the manufacturing’s average hourly earnings of $25.11, 10.8% higher than transportation and warehousing’s, and 11.5% lower than mining and logging’s. Average hourly earnings for residential building workers have increased significantly since the COVID-19 pandemic recession. The year-over-year growth rate reached to 8% in October 2021, the highest rate since February 2019, but this rate is now decelerating.

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