July 1, 2026
The Upjohn Institute New Hires Quality Index shows inflation-adjusted hourly earnings power of individuals starting a new job increased 0.1 percent in May 2026, to $23.01. The index is up 0.6 percent from one year ago. Hiring volume, after jumping between March and April, gave up some of its gains in May, sliding 0.4 percent. Nonetheless, hiring volume is still up 3.1 percent over the year. Adjusting for population growth, hiring rates are up 1.6 percent from last year, but they remain 8.3 percent below the pre-COVID baseline. Although hiring is no longer in idle, it is still very much in low-gear, and just as likely over the rest of the year to rev up or to stall.
This month, author Brad Hershbein explores the differences in hiring between public and private-sector workers. While the number of federal government employees has fallen by more than 300,000 over the past 18 months, local and state governments continue to hire. How have overall hiring dynamics changed in the public sector, and how do these compare to the private sector?
The earnings power of newly hired public-sector workers has been volatile. After spiking in the late stages of COVID, the wage index for public sector workers dropped 4.6 percent by May 2025 before regaining some of that loss over the past year. In contrast, the private sector wage index has remained largely stable and near record highs.
Despite the dip in federal government headcount, hiring volume has increased over the past year for both the public sector overall and the private sector. In fact, the public sector’s increase of 8.3 percent has considerably outpaced the private sector’s 2.3 percent increase. Hiring volume for the public sector is above prepandemic levels, even as volume in the private sector remains more than 4 percent below that point.
Government jobs may seem like they’re in the cross-hairs of late, but the data show that public- sector hiring is holding up.
Interactive charts and full data are available at upjohn.org/nhqi.