By Nathalie Voit
The lowest salary Americans are willing to accept for a new full-time job surged by 5.7% over the year in July to reach $72,873, the Federal Reserve Bank of New York said in its latest SCE Labor Market Survey.
The average reservation wage is up from $68,954 in July 2021, with respondents under 45, college graduates, and men reporting the greatest year-over-year increase.
The self-reported reservation wage is down from a series high of $73,283 in March.
Americans’ new pay floor for accepting a salaried position can be attributed to inflation and the still-hot job market.
The high cost of living has cut into workers’ purchasing power, meaning that the standard salary workers would have been content with three years ago simply does not cut it in 2022. At the same time, labor continues to hold the upper hand. According to the Labor Department’s Job Openings and Labor Turnover Survey released on Aug. 2, there are some 10.7 million job openings available in the U.S. economy as of June. Although the number of employment vacancies sharply tumbled from May, job openings are still near record highs.
The New York Fed data varied strongly by gender. While the reservation wage for men climbed to $86,259 in July, the minimum pay level needed to accept a new job offer declined to $59,543 for women.