Americans' minimum salary expectations surged in July, with the lowest annual wage that workers would be willing to accept for a new job increasing sharply from the previous year, according to a Federal Reserve Bank of New York survey published Tuesday.
The data shows the average reservation wage hit $68,954 in July, a more than 7% increase from the minimum of $64,226 in the year-ago period. Still, the figure is down slightly from the record high of $71,403 posted in March 2021.
The year-over-year increase was most pronounced for workers over the age of 45 and those without a college degree. At the same time, the average reservation wage for individuals with an annual household income below $60,000 actually declined when compared to the previous year.
Most workers said they expected an annual salary of job offers in the next four months to be around $57,207 – a jump from last July, when the salary expectation was around $54,656.
The number of Americans who expect to work past the age of 62 also ticked down in July, falling to 50.1% from 51.9% last July. It marked the lowest reading since the Fed started recording the data in March 2014. The average expected likelihood of working beyond age 67 also fell, dropping to 32.4% from 34.1% in July 2020.
The data comes amid a growing gap between job openings and hiring that suggests companies are scrambling to find workers, even though the unemployment is still well above the pre-pandemic level.
Critics have blamed the expanded federal jobless aid, which provided an extra $300 a week on top of regular state benefits to out-of-work Americans, for the labor shortage, although economists have also pointed to lingering health concerns and difficulty finding child care with many schools still closed. The boosted unemployment benefits officially ended on Sept. 6.
The Chamber of Commerce has warned the worker shortage poses the biggest threat to the economy's still-nascent recovery from the coronavirus pandemic after the government reported that the U.S. had a record-shattering 10.1 million vacant job openings in June, even though there are just 8.4 million unemployed Americans.
For comparison's sake, before the pandemic shut down broad swaths of the nation's economy, there were roughly 7 million available jobs.
The Fed survey comes in light of the Labor Department's August payroll report, which revealed the economy added just 235,000 jobs last month, an abrupt slowdown when compared to the gain of 1 million in July.