Stronger employment recovery in Midwest than South: New Hires Quality Index

Minneapolis street with bus, cars and pedestrians

The Upjohn Institute New Hires Quality Index shows the earnings power of people starting a new job steady near its all-time high in January 2021, at $17.32, 1.3 percent above its mark from January 2020. However, hiring volume has not rebounded to a level that would indicate a strong recovery from the pandemic recession.

In this month's release, Index creator Brad Hershbein focuses on the unequal labor market trajectories of two U.S. regions: the Midwest and the South. Of the two, the South saw faster increases in hiring volume following the Great Recession. With the onset of COVID-19, the Midwest had both more separations and more hiring.

In terms of hiring rates, which account for differences in population growth over time, the Midwest has consistently outpaced the South since the Great Recession. Because of the Midwest's recent faster growth in the wage index, the region’s recent hires are predicted to have higher earnings as well.

While the Midwest may be enjoying a stronger recovery than the South, the Midwest's share of the earnings power of all new hires in the two regions sits at 37.2 percent, well below the above-40-percent share it held in the early 2000s.

Read the full release or explore the Index.  

Date: March 3, 2021