Despite the steady decline in unemployment this year, the percentage of Americans who are working or looking for a job has barely risen.
Washington — American employers slowed employment in November, adding 210,000 jobs. This is the lowest employment in almost a year.
A Friday report from the Ministry of Labor also showed that the unemployment rate dropped sharply from 4.6% to 4.2%. This is historically low, but still above the pre-pandemic unemployment rate of 3.5%.
Overall, November employment statistics appear to be resilient, despite being threatened by rising inflation, labor and supplies shortages, and the potential impact of the Omicron variant of the coronavirus. Is shown.
Little is known about variants, and widespread business shutdowns are considered unlikely. Still, Omicron could discourage some Americans from traveling, shopping, and eating out in the coming months, slowing the economy.
But so far, Americans are free to spend and the economy is projected to grow at an annual rate of 7% in the last three months of this year, up from the 2.1% pace of the previous quarter when the delta variant was sluggish. I’m recovering. growth.
But under the numbers in the headings about employment and unemployment, there are potentially even more important questions. Will people who are unemployed in the pandemic recession eventually leave the bystanders to look for a job again? More job seekers are needed to enable companies to perform open jobs and sustain economic growth.
This is also an important issue for the Federal Reserve. If the percentage of people who have or are looking for a job hasn’t increased significantly, it suggests that the Fed is approaching its maximum employment goal.
Inflation is 30 years high, well above the Fed’s annual target of 2%, so meeting employment obligations will put more pressure on Chair Jerome Powell to raise interest rates sooner or later. .. Doing so will make the loan more expensive for many individuals and businesses.
Despite the steady decline in unemployment this year, the percentage of Americans who are working or looking for a job has barely risen. The shortage of job seekers tends to limit employment and force businesses to pay more to attract and retain employees. Higher wages help maintain spending and growth. However, if prices are raised to offset the high labor costs companies often do, it can also contribute to inflation.
As a result, there are 4.7 million fewer employees than before the pandemic. However, only about 1.7 million people are actively looking for a job and are classified as unemployed. The remaining 3 million are no longer job hunters and are not counted as unemployed. The government classifies people as unemployed only if they are actively seeking work.
About half of the 3 million people who lost their workforce have retired. The other half includes parents, mostly mothers, who were at home to take care of their children during school closures and day care. Childcare is either unavailable or out of reach for some of these women. Some other people have become self-employed. And others continue to delay their job search for fear of being infected with COVID-19.
Economists differ in the question of whether more people will soon resume hunting for work. Julia Pollak, a labor economist at ZipRecruiter, suggested that rising wages, near-record open jobs and lower unemployment rates provide an encouraging signal to those who are still on the sidelines.
Other economists are uncertain. Many of them expected more women to return to the job market as schools reopened. It didn’t happen, suggesting that some mothers may have decided to stay home forever.
And before COVID, many older Americans often came out of retirement to take on work, either for social reasons or to stay busy. However, far fewer retirees are returning to work because the coronavirus poses a special threat to older people. With the advent of the Omicron variant, that hesitation may continue.
Most indicators of the US economy in November were positive. Rapid increase in personal consumption, Even inflation is outpacing. Home sales increased in October at the fastest pace in January. According to a survey of factory purchasing managers Accelerating new orders and production.. For some manufacturers, there were even signs that the supply chain growls a little looser.
November Employment Report Shows U.S. Employers Add Slow 210,000 Employment
Source link November Employment Report Shows U.S. Employers Add Slow 210,000 Employment