|Click on Image to Enlarge|
Essentially, organic wage growth all comes down to vigorous job creation which appears to be seriously missing. There can be several reasons for this. The lack of funding to create startup businesses and entrepreneurship. Government over-regulation such as ObamaCare which forces businesses to convert workers to part time employment or to use contract labor. Or, low wages themselves which results in slow business activity and less job growth.
What I am trying to stress is that, since Obama has been in office, wage growth has been well below normal from about 3.5% to 4.5% annually. Now, while there has been an up trend that started last year, I believe that it had more to do with the fact that 29 States and the District of Columbia imposed minimum wages higher than the Federal minimum of $7.25. If so, this is not indicative of normal or sustainable growth. Only time will tell if true wage growth is restored to normal levels.
Chart Source: St. Louis Federal Reserve: https://research.stlouisfed.org/fred2/graph/?g=1Jf5#
What Is an Appropriate Annual Salary Increase?: http://work.chron.com/appropriate-annual-salary-increase-16035.html
Characteristics of Minimum Wage Workers, 2014: http://www.bls.gov/opub/reports/minimum-wage/archive/characteristics-of-minimum-wage-workers-2014.pdf
American Entrepreneurship: Dead or Alive?: http://www.gallup.com/businessjournal/180431/american-entrepreneurship-dead-alive.aspx