Discussion Paper
Regional Firms Report Wage Growth Returns to Normal Levels
Abstract: In mid-2021, regional businesses who responded to the Richmond Fed business surveys started to report accelerated wage growth. This wage growth coincided with increasing labor demand and challenges of finding workers with the right skills. In February 2024, we reported that wage growth was returning to normal levels, but it was still greater than prepandemic levels. To better understand if wage growth has returned to more typical levels, we not only analyzed our standard questions on realized and expected wage growth but also added a question in June 2021 to gauge how far firms are from what they would consider "normal" wage growth. By February 2026, realized and expected wage growth returned to prepandemic levels. Additionally, many fewer firms reported that their expected wage growth was greater than normal. We also found that firms' comments focused less on wages and labor and more on other issues that have affected their businesses.
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https://www.richmondfed.org/region_communities/regional_data_analysis/regional_matters/2026/regional_firms_report_wage_growth_returns_normal_levels
Description: Discussion Paper
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Bibliographic Information
Provider: Federal Reserve Bank of Richmond
Part of Series: Regional Matters
Publication Date: 2026-03-24