Lydia DePillis said US wage growth continued to slow in August. Average hourly
earnings rose 3.1% YoY, the weakest pace since the pandemic — still respectable
by historical standards but now below inflation after an energy-price spike tied
to the Middle East war. Local government education payrolls rebounded by 42,000
in August, suggesting earlier large declines were largely seasonal. Colby Smith
said the wage slowdown underscores why the Fed does not view the labor market as
the source of inflation; had wages been the main driver, the Fed would likely be
more inclined to raise borrowing costs to curb demand.
