The Economist Magazine came out with an article recently indicating that blue-collar wages are surging.
In the years following the end of the recession starting in June 2009, wages and salaries rose by only 8.7%. Prices, on the other hand, increased by 9.5%.
In 2015, the median household income rose by 5.2%, and in 2016 it was up by another 3.2%. The article noticed that poor households gained more, on average, than rich households, which is not only good news but a new and promising trend.
It appears that this is becoming a boom to the blue-collar wage-earners; for some blue-collar wage growth jumped by 4%.
This also appears to be a very positive development for those looking to enter the real estate market for the first time. First-time home buyers are now able to save more because they’re earning more.
Those blue-collar workers who seem to stand to benefit most are those that are in tight labor markets. One such employment niche is construction. The lack of skilled labor is clearly having an impact upon how much skilled labor is able to command in the marketplace. According to the Economist article, a year ago service workers were enjoying the biggest pay raise in the economy, which translated into 3.4% on average.
Improvement$
The article indicated that now isn’t a good time to remodel your bathroom. It seems that contractors who are tile workers earn 11% more per hour than they did a year ago.
The article indicated that now isn’t a good time to remodel your bathroom. It seems that contractors who are tile workers earn 11% more per hour than they did a year ago.
In addition to the tight labor shortages in the area of construction, it also appears that the oil industry is seeing a big boom as well. The company, America Hughes, reported that currently has 907 active rigs, compared to 568 from just a year ago.
As long as inflation remains stable or low, it appears that wage growth will give more economic power to those in the middle class.
And it is the middle class that will begin to not only enter as first-time home buyers but also begin to trade up their current homes to larger homes.