— not necessarily via mass layoffs but instead by hiring less aggressively, Zandi said. Data suggests employers are allowing jobs vacated by quitting workers to go unfilled, he said.Wages are growing at a historically fast pace — especially for thoseWages and salaries for private-sector workers grew about 4% in the fourth quarter of 2022, on an annualized basis — above the pre-pandemic pace but down from 6% at the end of 2021, Bunker said.
Average hourly earnings in January cooled to a 4.4% annual growth rate, according to Friday's jobs report, falling from 4.6% in December and 5.1% in November. "It may not be as easy today as it was a year ago to find a higher-paying job," Zhao said."But there are still opportunities out there."This cooling in pay growth is by design. The Federal Reserve is aiming to reduce wage growth to what it sees as a more sustainable level — one that doesn't fuel high inflation.the labor market was"very, very strong" due to job creation and wages — but also noted that it was"out of balance.
The Fed is trying to soften the labor market without triggering a recession — a so-called"soft landing." Reducing wage growth to 3.5%, as measured by the Employment Cost Index, would be consistent with the Fed's long-term 2% inflation target, Zandi said.