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Unemployment is nearing a 50-year low, but what’s good for labor could put pressure on major U.S. stocks, according to a new report from Goldman Sachs.

A team of strategists at the bank wrote in a note to clients Monday that S&P 500 companies, especially, could be affected by higher costs from a less competitive labor market.

“The labor market at full employment puts upward pressure on wages and downward pressure on corporate profit margins,” the team wrote. “While S&P 500 profit margins are at historical highs, survey data indicates a record level of corporate concern regarding labor costs.”

According to Goldman’s Wage Tracker, pay growth clocked in at 3.3% in the fourth quarter of 2018. That is the fastest it has grown since 2007, and Goldman’s strategists say “leading indicators show that wage growth should remain at or slightly above its current pace of 3%.”

Labor costs account for around 13% of revenues for the median S&P 500 firm, according to Goldman’s analysis. They predict a one percentage-point increase in the rate of wage growth would cut into S&P 500 earnings by around 1%.

Energy and financial companies have the least exposure to labor costs, while industrials and consumer firms face the largest risk, according to Goldman Sachs. So far, the mining and logging industry has seen the largest increase in average hourly earnings growth, according to the strategists.

The relative performance of stocks exposed to labor costs and those less at risk seems to indicate investors aren’t concerned about how rising wages could affect earnings.

“Despite low unemployment and an easy Fed, our Low Labor Cost basket (ticker: GSTHLLAB) has lagged the market in recent months, mirroring the negative growth outlook signaled by falling breakeven inflation,” they wrote.

Still, the strategists believe that if wage growth continues, stocks that are more insulated from labor costs could outperform the market.

“Investors who expect that easy Fed policy will contribute to a stabilization in US economic growth and continued labor market tightening should consider taking advantage of the Low Labor Cost basket’s depressed valuations to express this view,” they wrote.

Write to Connor Smith at connor.smith@barrons.com