Leisure and hospitality workers are getting their biggest raise in 20 years

• Wages and salaries grew by 0.9% from the first to second quarter of 2021.
• Leisure and hospitality jobs grew by even more - a lot more.
• Hospitality wages and salaries shot up 2.8%, the largest percent increase for the industry since 2001.

Workers are hard to find for employers in leisure and hospitality these days. That means higher salaries.

The leisure and hospitality industry saw a huge quarter of growth, according to the latest employment cost index released by the Bureau of Labor Statistics. Wages and salaries grew by 2.8% from the first to second quarter of 2021. As seen in the chart below, that's the largest quarter-over-quarter increase for this industry since 2001.

Nick Bunker, economic research director at the Indeed Hiring Lab, told Insider in an email that this growth in wages and salaries is good news for workers in the industry.

"The reopening of industries inhibited by the pandemic has led to many employers trying to staff up urgently as many job seekers seem hesitant to jump back into roles right now," Bunker said. "The result has been rising wages as employers try to make more hires when the supply is more constrained."

Bunker added that it's "unclear" if the robust quarterly growth in leisure and hospitality will continue this year, because "this acceleration may be primarily driven by the broader reopening."

Leisure and hospitality is still recovering from major job losses seen last spring as the industry was especially affected by the pandemic and related lockdowns. The industry is still down by about 2.2 million jobs from February 2020. Some employers are having a hard time finding workers, and some workers don't want to come back to work at restaurants and hotels at all.

A survey by Joblist found about 38% of former hospitality workers weren't thinking about coming back to the industry. To help attract new workers, employers struggling to hire have raised pay or introduced signing bonuses.

This wage and salary growth in the industry contributed to the overall gain seen from June 2020 to June 2021. As the Associated Press pointed out, the yearly increase for wages and salaries in the private sector, was the highest in over 14 years and was primarily due to the increase seen in leisure and hospitality.

Wages and salaries overall grew by 0.9% for the three-month period ending in June 2021, according to BLS data, down from 1.0% in the quarter before.

Wages and salaries in both manufacturing and construction grew by 1.3% from the quarter before. Similarly, wages and salaries in retail trade grew by 1.2%. Compensation costs overall grew by 2.5% in leisure and hospitality, again the largest growth from one quarter to the next.