Last week the data on labor market and industry saw the light. Despite working day toing and froing wage growth is forming an upward trend – notably visible in both manufacturing and total economy excl. mining. Employment is also taking off, albeit gradually and from low growth levels. Despite all arguments raised against the sustainability of labor market upswing, we believe that employment in support and administrative services is increasing not accidentally but because there is demand for such services connected with rising business activity (this labor market segment has leading properties). Therefore we believe that there is a possibility of upward wage pressure to build gradually in the following quarters; the more so since industry and construction has been lately on steady revival.
