NY Fed: Americans want $80K/year before taking new job
The base salary level which American workers demand before accepting a new job rose to a new high this year, due to persistent inflation.
The New York Federal Reserve reported in its July employment survey on Aug. 21, that the average “reservation wage,” or the minimum acceptable wage that workers will take to switch jobs, rose to $78,645 in the second quarter of 2023.
This is a year over year increase of about 8 percent and is the largest spike on record going back to early 2014.
Since the pandemic hit in 2023, the average minimum acceptable wage level has risen more than 22 percent, which is significant since wages increasingly are a major factor in inflation.
High Prices Impacting Wage Demands
Since March 2022, the central bank has raised interest rates to between 5.25 and 5.5 percent—the highest level in more than 22 years—to curb inflation.
Despite overall inflation falling to 3.2 percent last month, from a high of 9.1 percent in June 2022, households nationwide are still struggling with high prices and rising borrowing rates.
Other factors, such as rise in the price of food, housing, and gas, continue to keep the price of goods well above the Federal Reserve’s target rate of 2 percent.
U.S. consumers are increasingly also turning to credit cards and remaining pandemic savings for basic spending, due to high prices.
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