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Wages Increasing at 0.2 Percent, Slowest Rate in 33 Years

CEO says government intervention such as red tape and labor rules to blame

hand holding money
AP
• October 13, 2015 3:23 pm

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Wages and salaries grew at 0.2 percent in the second quarter of 2015, which was the slowest rate recorded in 33 years, according to data from the Bureau of Labor Statistics (BLS). This growth was down from the first quarter of 2015 when wages grew at 0.7 percent.

One businessman says that wages aren’t rising because of government intervention such as labor rules, wage laws, and environmental regulations, which could potentially harm his business.

"The rules are confusing, but one thing is clear: Companies of all sizes will have to expend money and time trying to understand and comply, not to mention deal with any lawsuits the change provokes," says Bob Funk, CEO of Express Employment Professionals.

Funk says this money could be better used to increase employees’ wages and benefits or used to hire more employees.

"There is a disconnect today between what government experts say about the economy when they crunch the numbers and what employers throughout America say when they make hiring and wage decisions," he says. "Businesses, small and large, are holding back."

Funk explains that one of those widely reported numbers government cites is the unemployment rate of 5.1 percent, while there are many American workers who have given up looking for work.

"Businesses, however, know there is a crowd of workers on the sidelines, and that labor markets are not as tight as generally believed," said the CEO. "With the unemployment rate at 5.1% and second-quarter GDP growth at an annual rate of 3.9%, some economists can claim that the economy is chugging along fine."

"But from where I sit on Main Street, that’s not the way it is," he said.