Economics
Surprise Jump in U.S. Wages Gives Inflation Debate a New Twist
- Restaurants, hotels hiring fast, some offering sign-on bonuses
- Growth in pay risks inflation spark; some see it as temporary
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An unexpected jump in U.S. wages has given financial markets a new reason to worry that higher inflation may be here to stay.
Consumer prices are rising quickly as the economy reopens after the pandemic. A closely watched data release on Thursday is expected to show prices rose another 0.4% in May -- pushing annual inflation above April’s 4.2%, already the highest in more than a decade.
Many policy makers and economists see the price spike as temporary –- partly because they haven’t been anticipating much in the way of wage growth, which has been relatively stagnant for years at the lower end of the pay scale.