spoiler
Salaries for new roles are stagnating – and in some cases, falling. Some employers may be looking to cut costs, but the lack of wage growth may be a matter of post-pandemic correction.
The mass US layoffs of the past few years are continuing. In 2024 alone, thousands of workers across many sectors, including media and technology, have lost their jobs and are on the hunt for new ones. But some are finding an unwelcome surprise as they scan listings for open roles. A salary bump is all but impossible; in many cases, wages seem lower than their previous pay – even for the same jobs.
They aren't imagining things. A 2023 report on pay trends from ZipRecruiter showed 48% of 2,000 US companies surveyed lowered pay for certain roles.
But, say experts, companies aren't necessarily just seizing a moment in a tight job market to reduce costs. In some cases, stagnant and even lowered salaries are the result of an overdue reset for a pandemic era surge in compensation when companies were scrambling to fill roles during the Great Resignation. The effect of oversupply
The tightening labour market has left US workers with fewer options than just years earlier. Beginning 2020, employers boosted salaries to new heights to attract talent to a deluge of open roles. But amid an uncertain economy, employers have pulled back from new hires and cut jobs.
"There is now less competition to hire workers – and therefore less need to boost wages," says Nick Bunker, US-based director of North American Economic Research at Indeed. "Job postings have dropped quite a bit, while the supply of workers has grown."
At its peak in early 2022, US wage growth for advertised roles climbed to 9.3% year-over-year, according to Indeed data. It has fallen precipitously ever since, as demand for workers has slumped. By January 2024, it had plummeted to 3.6%. The downward trend continues, and it's unclear when it will reach the bottom.
Now, with a decline in open roles, workers have fewer opportunities to get new jobs and secure better compensation. Simply, employees have less leverage to negotiate pay or secure a better starting salary – especially if they're clawing for any type of employment they can get.
In some cases, says Bunker, a company may not outright drop their compensation for new roles, but in the current environment of inflation, money simply won't go as far – the same wage as before may feel like a pay cut to workers. But in other cases, a greater supply of workers against weakened demand may mean a similar position from 2022 is now advertised with a lower salary.
This is most likely to happen in industries that had the greatest competition for workers during the hiring crisis. For example, Indeed data shows US hospitality and retail jobs experienced 11.8% wage growth year-over-year in February 2022 – falling nearly four-fold 3.4% by January 2024. Companies in other sectors, such as tech, which once experienced a high demand for workers, are now also resetting expectations.
"We saw a massive bull run in the market during the pandemic, where there was a big increase in baseline compensation for workers because of talent shortages," says Chris Rice, of Boston-based US executive tech recruiting firm Riviera Partners. "We're still seeing a market reset that's ongoing. An oversupply means compensation has dropped because the demand is no longer there." 'A whiplash effect'
Ultimately, employers who are filling roles after layoffs or hiring freezes are likely to use the newfound leverage they have, says Till von Wachter, professor of economics at University of California, Los Angeles. "They'll tend to orient their new salaries at the going rate, so starting wages may fall in order to equilibrate the market," he says.
The current phenomenon may be felt most acutely in the US because of how its economy rebounded from the first Covid-19 lockdown in 2020. Indeed data shows its peak wage growth dwarfed that of the UK and Europe. "The US economy jumped out the gates in the wake of stimulus packages and mass vaccinations," says Bunker. "So, wage growth has faded rapidly amid less job market churn and switching."
In many ways, what we're seeing is a correction. Wage growth is reverting to pre-pandemic levels of below 3%, says Bunker. "A 9.3% spike in year-over-year wage growth is anomalous in many ways. It came from the initial shock of Covid-19, and an economy heading towards recession suddenly rapidly expanding, then having to suddenly hit the brakes again. It's a whiplash effect."
At current rates, wage growth may return to pre-Covid levels by May 2024, says Bunker. Whether it rises, plateaus or shrinks from there depends on whether hiring picks up. And if inflation continues to rise, workers will increasingly feel the pinch of these new lower or stagnant salaries, he adds.
While inflation has begun to drop in the US and UK, the cost of living has outstripped salary increases for nearly three years, says Bunker. "Real wages today are still below where they would have been presumed to be, pre-pandemic. So, it's a race between inflation and wages."
Falling wages while inflation keeps chugging along. Companies love it
We got inflation, we got shrinkflation, we got price gouging, we got climate change shutting down the Panama Canal and a genocide shutting down the Suez Canal to our ships indicating another supply shock coming soon. Everything, and I cannot state this desperately enough, is fine.
Bidenomics saves the day. Yes food and rent are more expensive, yes wages are down, but
Genuinely at this point it’s like “You know what maybe Trump was better”
I already thought Trump’s incompetence made him better for the rest of the world, but at this point I’m like “At least under Trump the economy wasn’t this fucked”
I don't think it being fucked is going to change regardless of who is in office. Neither are willing to do the fundamental changes necessary to put a stop to this lol. Trump just gonna look at it and filter it through his own "actually this is good" rhetoric.
There is a the possibility that this shit is a "Capital strike" in that they are arbitrarily raising prices to make Biden incredibly unpopular. But there's so many other factors such as supply chain shocks, climate change affecting ag yields, land use for meat production, drought, water, and fossil fuel prices. That unless some dumbfuck leaks the Illuminati/McKinsey "BreadFixing" Groupchat or the DOJ charges several high ranking officials at multiple conglomerates, nothing will happen until Trump gets in power.
That wasn't spooky enough, you should hold a flashlight under your chin and do spooky ghost noises while saying "trump baaad"
Unfortunately I'm too busy imagining how fucked we'd be if a second Chicxulub-scale meteor hit the planet and wiped out 90% of all terrestrial life.
corporate wants you to find the difference between these pictures:
Except people are suffering now
They're suffering now and the best you or any other liberal politician can do is go "
The economy is fine Jack
"And for people who love to talk about Orwell, that's a hell of a lot more 1984 then even that old Limey jag-off imagined
There's currently 750 armed national guardsmen conducting mandatory searches of people's belongings in the NYC subway system. This happened under a D governor, under a D president. If this happened in North Korea or China you'd be losing your fucking shit. As long as it isn't an R in charge though....
Why are so many of you fucking bozos back in here? Nobody in here buys the electoral politics schlock, go back to telling each other fanfiction of how perfect everything would be if libs were in charge forever
Fed and companies don't care still gonna drive down labors wages and power
: "Bro, bro BRO! You gotta stop working for the man to make money, bro! You were supposed to invest bro! Just buy a starter house and rent it out, bro! Poverty is a mindset, bro! You can become rich just by deluding yourself into thinking you are, bro! You can also just start your own business bro, MANIFEST that shit, bro!"
That's nonsense. You didn't take a 40% cut to your salary.
Your money is also worth less so it's higher than that
Conservatives will tell you that the real "Minimum Wage" is $0, and I'm beginning to suspect this is their end goal.
After deducting the cost of your dormitories and the chit allotment in the company store your take-home pay is zero dollars.
In a systemic way, that’s literally how things are right now lol
Most people are in some type of debt and have negative net worth. Like most people literally need to spend more than they earn to survive. And the money comes from working at a capitalist company, and spent at capitalist companies.
The whole world is a giant corporate town (except for the good places ofc).
The whole world is a giant corporate town (except for the good places ofc).
They're arguably the worst. The folks that live in those places just have an exceptionally long line of credit, so they can keep the ball rolling indefinitely.
love giving 30% of my paycheck back to my job because im too tired to shop anywhere else (plus i can get some first come first serve discounts)
oh wait now its 35%. 40%. and all the food packages are half empty wtf
I know chips are the classic and kinda misunderstood example but fuck, I grabbed a bag of chips - not even a name brand, just a store brand - and the fucking thing cost me six bucks (CAD) and barely felt a quarter full
from where i work you can tell when they do the shrinkflation thing because an item that typically sells well will go onto "closeout" or be "discontinued" and then brought back a week or so later but with like a few fractions of an ounce (or a few dozen grams) removed.
maybe the package imagery or logo changed a bit to distract people
i've noticed chips and sodas doing this the most frequently followed by dry cereal and dairy products
I noticed that shit with cereal, especially. It'll disappear, then come back with 'new' written on the box. Mf, I've been buying this for years, it's not a new product just because it wasn't on the shelves for 6 months during a supply chain crisis. If it even was a crisis and not a planned withdrawal as happens with land to manipulate the supply/demand ratio as if that's how prices work. It's hard to know if they're really so stupid or whether they follow that logic as a marketing strategy. I think the latter but it's really hard to show that much respect to their intelligence.
most people unfortunately just direct their anger at the retail level, like the employees as though every company is run as a worker-owned co-op and we set the pricing ourselves
although silver lining is im noticing more and more people are waking up and directly their anger to more amphorous forces far beyond our level. obviously this is either the big "THEY" or something really fascist or rarely "billionaires" or "elites". so shit could go either way but i have little hope sometimes
i try my best to subtly educate as many as possible without setting off anyone's anti-communism brainworms
Yes but see you just don't understand the economy. Let me explain how nobody being able to afford housing or food or transportation or healthcare is actually a good thing.
Cameras cut to the most insufferable rich fuck they can find "because, fuck you, that's why. Now quit watching TV and get back to work, billionaires on yachts depend on your labor!"
Well, it is a good thing really, if the ultimate goal is going back to slavery. We shouldn't assume worsening economy will lead to some leftist revolution it will just as likely lead to some combination of fascism and 19th century capitalism conditions. If anything the liberals will march right along saying the 2048 election is the most important election of our times because they realy want to bring back slavery so you must vote....
Honestly, I just don't think (or maybe want to doubt) it will get to that. Call me unmaterialist, but I have this hairs-on-the-back-of-my-neck inkling that people in the US are waay closer to another breaking point than we let on. Anecdotally, I went to a Gaza protest last week and out of thousands of people there, I saw no libs and zero
shit. Everyone was a communist, the speakers and organizers were communists, there were communist flags, it's communist time baby
Yeah in general if I see someone complaining about shit and they’re not a clear leftist I just don’t listen. You’re not serious about fixing shit at that point. I’m not disrespectful obviously because I don’t want to be rude, but I’m not taking what you say to heart either.
Funny how when wages go down its a post-pandemic correction (even though the pandemic isn't over) but when prices stay high its just that the market moves in mysterious ways.
Perfect radicalization tool. If you're poor, you will see an increase in suffering as a result of the economy being good, so "the economy" is irrelevant at best for poor people or our outright enemy.
I think it's only fair we also "reset" all the employers' wealth too, then
Everything under capitalism will continue to increase in price, except for wages, because wages increasing would cause inflation.
So you're saying capitalism is designed to exploit the working class?
No that's a communist conspiracy theory.
: "Stupid lefties, they think everything they dislike should be banned but everything they do like is a human right that should be paid for by others!"
Also
: "Having a business is a human right, and that's why we need workers to work for free!"
I did an unsuccessful job search last month and the number of recruiters talking about the company using benchmarks to set salaries was up significantly from my last job search a couple years ago. Like from 0 to every single fucking one.
Smells an awful lot like the way RealPage fucked tenants by helping landlords collude to raise rents.
It is exactly like that. Companies continue to corporatize and consolidate. HR becomes more and more the domain of consultants (read: 🐍). And as wage setting consultancy is itself centralized into a small number of companies, the ability to collude and fix labor market prices becomes a reality. Real Byzantine ancap shit.
Capitalism fails because it goes against business interests to compete, the bourgeoisie have a shit-ton of class solidarity.
Boy are they going to be surprised when their profits start "resetting" because nobody can afford their shit
Capitalists really do perform a great job in showing us why a command economy is more efficient. Because of "muh shareholder value" we're in what is essentially a man-made famine.
Is this even going to happen though? Companies that run into trouble just get bailed out by the federal government, which can print dollars endlessly due to imperialism.
A person I know was one of the overpaid tech workers until he quit his job mid last year, expecting to take a few months off and then jump back in elsewhere for +20% pay. There's a bit of schadenfreude watching him seek work now and not just getting things on a silver platter.
Was he underpaid, or are you just under paid?
Schadenfreude seems misplaced when it's just that one segment of the workforce escaped getting fucked over, and now they've joined the majority in getting fucked over.
He's a reactionary treat baby and a landlord. I hear you and you're right on a systemic level. Nevertheless, I never claimed to be a perfect communist and I hope many many other people get better treatment before this guy does.
I got a 9.5% raise this year (which honestly pissed me off because if you're gonna give someone a 9.5% raise just go for fucking 10%) but lol with inflation it is meaningless. supervisor was like "yayyyyy :)" when they told me only to be shocked when I went
"cool this brings down my rent budget from 80% of my monthly income to ~75%"
Idk what to say whenever I get a raise. I'm aware that they're expecting you to say "thanks" or something like that but it feels too much like ass kissing.
Especially when I can plainly see that I've gotten poorer despite the raise due to inflation.
I usually just do an "oh, good". Feels weird to effusively thank them when it's always less than what I deserve and we both know it, it's hard to hold it in.
Imagine being a normal person, sitting and writing this drivel uncritically, seeing what you have made and not minecrafting yourself immediately.
"It's not fair that material conditions made it clear we could pay far better than we were willing to before the pandemic forced our hand. Mods plz
"
I recently regained access to Costco after a four year, "I don't have any fucking money," gap. Prices are literally double what they were in 2020.
Anyway, falling wages is good for The Line.
The rare case where youtube comments are mostly good (and taking the dipshits in the video to task).
Sorry but the science of economics has spoken: higher wages is bad and unnatural, lower wages is good and natural.