The U.S. Department of Labor’s Bureau of Labor Statistics showed an uptick in legal jobs in its monthly employment report for the third straight month. Michigan News Network Business Editor Murray Feldman tells us some industries are showing strong growth. Consider this: In 2015, the US added 200,000 or more jobs a month nine times. “That means many people were helping individuals and families with service needs”. Average hourly earnings grew 0.2% to $26.25 an hour.
June’s jobs report reflects this, according to Bankrate.com senior economic analyst Mark Hamrick.
“No doubt Trump’s America First agenda and his tweaking of the federal procurement program have created new tailwinds to help spur manufacturing”, he said. Average hourly earnings were only 0.2% in June, while they’ve gained just 2.5% on the year.
Average hourly earnings rose four cents for the month to US$26.25 (S$36.28), up 0.2 per cent over May and 2.5 per cent higher than June of previous year.
Employment increased in health care, social assistance, financial activities, and mining, according to the report. “Despite the broad-based strength in measures of employment, wage growth has been only modest, possibly held down by the weak pace of productivity growth in recent years”, the Fed observed in its revised economic report Friday.
“With President Trump in the White House, Republicans have already taken historic steps to roll back damaging regulations that have discouraged investment, dragged down our nation’s productivity, and left too many workers waiting for better employment opportunities”. “On balance, the labor force data continues to suggest that the economy is having little difficulty absorbing Federal Reserve [interest] rate hikes to-date and should provide additional confidence that more are warranted”. The unemployment rate on Inauguration Day was 4.8%, and it has fallen since then, to 4.4% in June. But the increase, to 4.4 percent, was for a good reason – 361,000 people joined the labor force a month after it contracted. There is growing anecdotal evidence of companies struggling to find qualified workers. It’s even harder when memories remain fresh of a time when almost 9 million people were thrown out of work and the unemployment rate rocketed to 10 percent, as happened during and after the 2008-2009 Great Recession. CareerBuilder’s 2017 Midyear Job Forecast is predicting that 60 percent of employers plan to hire full-time, permanent workers in the second half of this year, up from 50 percent last year. So to offset the cost of leaving wages untouched, many employers have withheld raises as the economy has improved.
Over time, that tightness – full employment, as the Fed sees it – is expected to feed through to higher wage inflation, justifying less accommodative monetary policy.