Issue Brief: New Hire Wage Index
Every quarter, the U.S. Bureau of Labor Statistics releases the Quarterly Census of Employment and Wages (QCEW), a dataset that provides a snapshot of the current state of the labor market in a defined geographical region. The QCEW is one of the most cited resources for the labor market and is used often by the media, policymakers and academics to provide commentary, analysis and projections. While the QCEW is indeed a high-quality source for labor market data, it is also limited with respect to information it provides on wages. While it will tell the user what the average quarterly wage is in an industry, it will not provide any information for how new hires will fare in this industry.
In this issue brief, we use an alternative source of data to take a deeper dive into wage rates for new hires. The primary source of data in this analysis comes from Quarterly Workforce Indicators (QWI), a dataset published by the Center for Economic Studies at the U.S. Census Bureau. The QWI provides county-level economic indicators (such as employment, job creation and earnings) detailed by both firm characteristics and demographic information.
Main findings from the Issue Brief include:
- Industries such as finance and insurance and professional, scientific, and technical services had steady improvements in new hire wages, while others (such as accommodation and food services, construction and retail trade) have shown little to no growth over the past 20 years.
- New hire wages have grown primarily for the population over the age of 55, with smaller growth for the 25 to 54 age group.
- Smaller businesses have also struggled to increase new hire wages over the past 20 years, as firms with less than 50 employees had much smaller indices than firms with at least 50 employees.
Download the latest Issue Brief for more information.