Read our full analysis for a more in-depth look at these trends.
The Institute Employment Report: February 2026
Our estimate of payrolls growth accelerated in February, but with further widening in wage gaps.
March 2026
Key takeaways
- Payrolls growth accelerated to 1.3% year-over-year (YoY) in February, according to an estimate of payrolls based on Bank of America customer account data. At the same time, the growth in the number of households receiving unemployment benefits has flattened out. Overall, the impression is of a strengthening labor market in the early months of 2026.
- But there is a more concerning picture in Bank of America customer account data on after-tax wages and salaries. In particular, while higher-income wage growth rose to 4.2% YoY in February, lower- and middle-income wage growth slowed, to 0.6% and 1.2% YoY, respectively. The gap between higher-income wage growth and other cohorts is the largest it has been since the beginning of our data series.
- One reason for cooling wage growth amongst lower- and middle-income households may be weaker pay raises when changing jobs. In Bank of America internal data, the pay raise associated with a job change was 6.7% in January, down from the 2025 annual average of 8.6% and the double-digit gains during the “Great Resignation” period.
Additional Materials:
Get the latest from Bank of America
Institute delivered right to your inbox.
