The lift in December’s average hourly earnings of 2.9 percent was the best in the recovery and nicely tied up the Obama administration’s legacy, Labor Secretary Thomas Perez told CNBC on Friday.
“The wage growth is the best wage growth we’ve seen in the recovery,” the outgoing Labor chief told “Squawk on the Street.” “I’m heartened by the wage growth we’ve seen not just in this report, but in the recent trend data, and we’ve got to continue to sustain that progress.”
Friday’s report from the Bureau of Labor Statistics said wages grew by 10 cents to $26 after November’s slide.
It also said the unemployment rate climbed to 4.7 percent and nonfarm payrolls grew by 156,000 in December, missing economists’ expectations of 178,000. The gain brought 2016’s total added jobs to 2.2 million, down about half a million from last year.
Perez said minimum wage increases last year in states like California and New York boosted the states’ economies and enriched their residents, despite criticism that the hikes could kill jobs.
“If those doomsayers are correct that minimum wage increases are a job killer, then we would’ve seen evidence of that in all these statewide minimum wage increases that have been enacted with the strong support and encouragement of the Obama administration,” Perez said.
“And guess what? Once again, the evidence shows that people have more money in their pockets and it hasn’t been a job killer,” he continued.
Looking ahead, he said the most important thing for his designated successor, CKE Restaurants CEO Andy Puzder, to keep in mind is the rapidly changing nature of the job market.
“I think a key to success for all the workers in this country is to make sure that we equip them not only with the skills to do today’s jobs, but the core competencies to do tomorrow’s jobs,” Perez said.
He said new technologies like autonomous vehicles and the cloud could be job creators if the Labor Department can anticipate their developments. For example, autonomous vehicles will eventually need repairmen, he said.
“We’re the department of opportunity,” Perez said. “We invest not only in the skills of today, but producing folks who may have been yesterday’s steelworker, but now they’re today’s advanced manufacturer.”
Perez called the Bush 43 administration’s decreased spending on federal employment and training initiatives “short-sighted,” arguing that investment in “human capital” is the best investment a government can make in an era of innovation.
“You can’t swim upstream against innovation,” the Labor secretary contended. “But what you can do is equip people with the tools to handle innovation.”