Notwithstanding the strong job growth of recent years, wage growth has lagged economists' expectations and the real average wage in 2018 has about the same purchasing power as it did four decades ago, an analysis by the Pew Research Center finds.

Based on data from the Bureau of Labor Statistics, the analysis found that in constant 2018 dollars, average hourly earnings for non-management private-sector workers rose only slightly between 1964 and 2018, from $20.27 to $22.65, and that real average hourly earnings peaked in January 1973 at $23.68 in constant 2018 dollars, at which point they began a two-decades-long slide and have grown inconsistently since then.

The analysis also found that what wage gains there have been have flowed mostly to the highest-paid tier of workers. Since 2000, for example, weekly wages have risen 3 percent (in real terms), to $426 a week, among workers in the lowest earnings decile, compared to 15.7 percent, or $2,112 a week, for those in the top decile.

One explanation for the stagnation in wages — which often is cited as a key factor driving widening income inequality in the United States — is that rising benefit costs, especially employer-provided health insurance, may be constraining employers' ability or willingness to raise wages. Other factors include the continuing decline of labor unions, lagging educational attainment, non-compete clauses and other barriers to job-switching, a large pool of potential workers who are outside the formally defined labor force, and broad employment declines in manufacturing and production sectors, and, as a result, a shift toward job growth in low-wage industries.