Goods sector not keeping pace with services sector: New Hires Quality Index

construction workers sit by a digger for lunch
The Upjohn Institute New Hires Quality Index slipped 0.2 percent between April and May to $21.36, off 0.3 percent from a year ago but up 2.5 percent since the start of the pandemic. Hiring volume reversed a three-month slide, up 0.6 percent over the month, while hiring rates – which adjust for population growth – remain historically low.
In this month’s news release, index creator Brad Hershbein compares new hires from goods-producing and service-providing industries. The New Hires Quality Index wage index in the goods sector dropped 2.5 percent over the past year, while the wage index for the services sector grew 0.2 percent.
Hiring volume fell for both sectors, faster for the goods sector, although hiring rates (which adjust for population) fell similarly for both: down 4.8 percent over the year in goods and 4.6 percent in services. The share of the total earnings power among all new hires accruing to the goods sector has declined over many years and now sits at 17.5 percent, near a series low.  

Date: July 3, 2024