The lowest wage that American workers are willing to take in order to accept a new job hit a record high this year, according to a Federal Reserve Bank of New York survey published Monday.

The average “reservation wage” – or the minimum acceptable salary offer required for workers to switch jobs – hit $78,645 during the second quarter of 2023, according to the Fed’s latest survey of consumer expectations.

That marks a nearly 8% increase from the same time last year when the average reservation wage hovered around $72,873.

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The year-over-year increase was most pronounced for workers over the age of 45.

Workers with a college degree now expect a $98,600 annual salary in order to take a new job while those without one indicated they would not accept a salary below $63,300.

The extremely tight labor market has allowed workers to quit their jobs in favor of better wages, working conditions and hours – a trend dubbed the “Great Resignation.” The Labor Department reported this month that the economy had 9.6 million positions open at the end of June, meaning there are roughly 1.6 posted jobs for every unemployed worker.

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Switching jobs has proved to be a lucrative move for many Americans. Workers who changed jobs in June received a 7% annual pay raise, which compares to the 5.5% pay raise seen by those who stayed in the same position, according to recent data published by Federal Reserve Bank of Atlanta.

However, rapid wage growth has also been a key driver of high inflation over the past two years.

The Federal Reserve has repeatedly continued to caution about the possibility of a wage-price spiral, with Chairman Jerome Powell speaking about the risks of substantial pay increases.

“I think many, many analysts believe that it will be an important part of getting inflation down, especially in the non-housing sector, to getting wage inflation back to a level that is sustainable, that is consistent with 2% inflation,” Powell told reporters in June.

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A wage-price spiral occurs when prices march higher and workers demand additional compensation in order to keep pace. That, in turn, can push inflation even higher as companies look to offset the steeper labor cost.

Still, there are signs the labor market is beginning to cool off in the face of higher interest rates. Employers added 187,000 jobs in July, the lowest level in two years as demand for workers begins to recede.

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Charles Schwab says it is preparing to reduce both its headcount and real estate footprint in a series of cost-cutting measures aimed at streamlining operations.

The San Francisco-based brokerage giant reported in a Securities and Exchange Commission filing the moves were “directly related to the integration of TD Ameritrade,” which Schwab acquired in 2020.

Schwab said the company is looking to close or downsize some of its corporate offices, and “plans to reduce its operating costs primarily through lower headcount and professional services.” 

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In response to FOX Business‘ request for comment, the company said in a statement, “We have said, we intend to take a series of actions this year and into 2024 aimed at removing cost and complexity from the firm, including reducing our expense base and streamlining our operating model.”

Schwab did not say how many jobs might be impacted by the move, but added, “This will result in eliminating some positions in the coming months, mostly in non-client facing areas. We don’t yet have specifics to offer on how many positions will be eliminated.”

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According to the filing, the company expects to save at least $500 million a year through these cuts, but expects to pay as much as that in employee compensation benefits and facility exit costs when they occur.

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The layoffs will likely happen before the end of the year, the filing said, while the real estate exit costs will likely carry into 2024.

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