Last week two reports came out on job growth that were slightly disappointing. The U.S. job market grew by 130,000 in August, less than expected but still solid for the stage of the business cycle. A report on Pittsburgh job growth showed that only 800 new jobs were added in July. That's weak but in the face of a growing wave of retirements, the positive change shows that economic momentum exists. Data on wages was solid in both reports. U.S. workers are earning 3.7% more than a year ago. That pace is double the rate of core consumer inflation. Wage earners in Pittsburgh have seen growth that is slightly higher, with the median weekly wage at $1,075 in Pittsburgh. That's $167 higher than the U.S. median wage.

The report on July inflation had good news for construction. Although the produc er price index for nonresidential construction rose at a healthy 5.6% rate year-over-year, that inflation rate is holding steady. With virtually all significantly prices changes turning negative year-over-year (especially the prices of diesel fuel, lumber, metals, and steel) the outlook is for lower construction inflation going forward.

Source: Federal Reserve Bank of St. Louis

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