Barclays (LON:BARC) has provided insight into the labor market with its latest Labor Market Tracker, indicating a rise in the rolling three-month average hourly wage to $20.82 in September 2024, marking a 5.1% year-over-year increase. This compares to August 2024's average hourly wage of $20.60, which was a 3.5% increase from the previous year.
The current data suggests a return to mid-single-digit year-over-year wage growth, a shift from the significant spikes observed from the second half of 2021 through 2023.
The tracker, which is based on around 36,000 rolling three-month average monthly job postings that include the hourly wage, suggests that the average hourly wage metrics are directionally accurate.
However, Barclays notes that the absolute hourly wage figures might be inflated compared to what is reported by restaurants. The reported cost reflects the expense of hiring an additional worker, not the wages of existing staff.
The data from Barclays' tracker is significant for the restaurant industry, which has been closely monitoring labor costs following the notable wage increases in the past years. The latest figures provide a more encouraging outlook for the sector, as the wage growth appears to be stabilizing.
Barclays' analysis of the labor cost trends is an important indicator of the economic environment for restaurants, as labor expenses represent a significant portion of their operating costs. The tracker's findings are based on the assumption that the job postings analyzed are representative of broader wage trends in the industry.
The bank's commentary on the Labor Market Tracker underscores the ongoing attention to labor costs within the hospitality sector. As the industry continues to recover and adapt to changes in the labor market, such insights remain critical for businesses planning their financial strategies.
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