Young workers experienced the strongest wage growth during the recent labor market surge, especially at the height of the post-pandemic hiring boom.
The chart compares median nominal wage growth across age groups using peak 2022 values and more recent growth rates. Workers aged 16 to 24 posted the largest increase, reaching 13.0% wage growth at the 2022 peak.
Even after wage growth cooled, younger workers still maintained stronger gains than older groups.
The Biggest Wage Gains Went to Younger Workers
The standout figure in the chart is the sharp rise in wages among workers aged 16 to 24.
At the peak in 2022, this group recorded wage growth of 13.0%, roughly double the pace seen among workers aged 25 to 54 and more than twice the growth recorded by workers aged 55 and older.
More recently, younger workers still posted the fastest wage growth at 5.2%, compared with 4.5% for prime-age workers and 4.2% for older workers.
The data suggests that entry-level and lower-wage positions experienced the strongest compensation pressure during the labor shortage period.
How Other Age Groups Compared
Workers aged 25 to 54 saw peak wage growth of 6.5%, while workers aged 55 and older reached 5.4%.
Those increases were still historically strong by pre-pandemic standards, but they lagged well behind the gains seen among younger employees.
The gap narrowed over time as labor market conditions cooled and hiring demand stabilized, yet younger workers continued to maintain a slight advantage.
This pattern reflects how wage growth became concentrated in industries with high turnover and strong competition for hourly labor.
Why Younger Workers Saw Faster Pay Growth
Several labor market conditions likely contributed to the surge.
Retail, hospitality, food service, and other entry-level sectors faced severe worker shortages after the pandemic. Employers raised wages aggressively to attract and retain younger employees who make up a large share of those industries.
Job switching also became more common among younger workers, allowing many to secure higher pay through frequent moves between employers.
At the same time, older and more established workers often experienced steadier but slower compensation growth because their wages were already higher to begin with.
What This Means for Workers
The chart highlights how tight labor markets can temporarily shift bargaining power toward younger and lower-wage workers.
For many young employees, the period between 2021 and 2023 created unusually strong opportunities for wage gains, especially in service-oriented industries.
However, the recent slowdown in growth suggests that the labor market is gradually normalizing.
The broader takeaway is that wage growth remains positive across all age groups, but the extraordinary gains seen during the post-pandemic hiring boom are beginning to fade.
Dataset
Data Sources
Federal Reserve Bank of Atlanta. (2026). Wage Growth Tracker. https://www.atlantafed.org/research-and-data/data/wage-growth-tracker
Federal Reserve Bank of Atlanta. (2026). Employment Data Tools and Wage Growth Analysis. https://www.atlantafed.org/what-we-study/employment
Federal Reserve Bank of St. Louis (FRED). (2026). Wage Growth Tracker release. https://fred.stlouisfed.org/release?rid=637
U.S. Bureau of Labor Statistics. (2026). Current Population Survey. https://www.bls.gov/cps/
