"The economy isn't growing fast enough to boost job growth to increase incomes," said Omair Sharif, an economist at RBS Securities LLC in Stamford, Connecticut. "Most workers don't have a lot of sway in demanding higher wages unless they have very specialized skills."
'Hold the Line'
Werner Enterprises Inc., an Omaha, Nebraska-based truck operator, has "been able to hold the line on our salary, wages and benefits costs," John Steele, chief financial officer, said on a Sept. 8 analyst conference call. In today's "uncertain" economic environment, "there's a little less pressure on driver pay than there was a couple of months ago."
UPS, the Atlanta-based package-delivery company whose shipments make it an economic bellwether, has "a very reasonable contract in place that will show modest, below- inflation increases in wages" for drivers, Chief Financial Officer Kurt Kuehn said on a July 26 teleconference. "We've got a good outlook for the cost structure."
Employees cannot hope for more bargaining power anytime soon, said Harry Holzer, a professor of public policy at Georgetown University in Washington and former chief economist at the Labor Department. Through August, the U.S. had recovered only about 1.89 million of the 8.75 million jobs lost as a result of the recession.
"There is so much slack, it will keep earnings from rising very much," he said. "It will take most of this decade" to repair the damage "unless there is a big spurt in hiring."