Slow wage growth has dampened worries about inflation “as average raises exceed price increases.”
President Donald Trump has another stellar job report under his belt. Economists predicted 190,000 jobs in April, but the report shows the month added 263,000 jobs while the unemployment rate went down to 3.6%.
The unemployment rate has not hit 3.6% since 1969.
Look at that graph. You know what that tells me? If failed presidential candidate Hillary Clinton ran on the economy instead of social justice she may have stood a chance. Thing is, the economy wasn’t bad under President Barack Obama.
I continue to stress that the majority of Americans care mostly about their wallets. They want a steady job and money in order to provide for themselves and their family. That is the main priority.
If the economy keeps this up, Trump will have a victory in 2020.
The boost in jobs came from massive hiring “in professional business services, construction and health care.” Retail saw a drop in hiring “for the third straight month.” Manufacturing jobs remain bleak as that sector only added 4,000 jobs in April.
Nonfarm payroll jobs went up “by 1.76% over the past year.”
The economy has added around 205,000 jobs in the first four months of this year. It didn’t help that February saw a dismal jobs report. 2018 averaged about 223,000 each month, but the April report helped keep alive the average of 201,000 jobs a month for 103 months. That started in October 2010.
The job market did lose out of prime-age workers aged 25-54. The participation rate of these people fell to 62.8% from 63%.
Onto unemployment! From The Wall Street Journal (emphasis mine):
The unemployment rate fell in part because the number of Americans in the labor force shrank by almost 500,000 in April. The fraction of Americans with jobs or actively looking for work fell to 62.8% in April from 63% the prior month. The rate had slowly crept higher from a multidecade low of 62.4% touched in 2015. The rate remains below prerecession levels, suggesting the economy has more capacity to draw in workers.
Friday’s report showed a broader measure of unemployment, including those too discouraged to look for work, plus Americans stuck in part-time jobs but who want to work full time, held steady at 7.3% in April. The rate is slightly higher than it was in 2000, even though the headline unemployment rate is lower. That suggests additional workers may yet be available to fill a near-record number of job openings.
In previous cycles, by the time the unemployment rate neared 4%, the number of Americans on the edge of the labor market had also significantly shrunk—and wage growth accelerated more dramatically, said Marianne Wanamaker, a labor economist at the University of Tennessee. There is evidence that those ranks have yet to thin in the current labor market.
Those who stay on unemployment went down to 9.4 weeks in April.
The unemployment rate looks even better since the “broader measures of unemployment declined in April.” The broadest measure, though, has not changed since February: part-time workers looking for full-time jobs. This held at 7.3%.
Unemployment for people with less than a high school education dropped “to 5.4% in April from 5.9% in March.” Those with a high school diploma “saw their unemployment rate drop, to 3.5% from 3.7%.”
People saw hourly wages grow by 6 cents to $27.77 an hour. This increase “was much stronger than the 2.8% increase in April 2018 from a year earlier.”
However, April’s weekly wage growth slowed a tad and topped off at 2.9%. It’s the first time since January 2018 that weekly wages growth went under 3%. One analyst said we shouldn’t worry about this just yet.
US Hourly Earnings up 3.2% in the past year outpacing core inflation (YoY) for 77th consecutive month. Spread of 1.2% above inflation is highest level of expansion. #payrolls pic.twitter.com/VoZF2ID8XY
— Charlie Bilello (@charliebilello) May 3, 2019
While some may groan about slow wage growth, I don’t mind it because it slows down inflation. The wage growth has not shown a change in prices from companies “as average raises exceed price increases.”
So, in other words, people can enjoy a little more in their paycheck while us consumers don’t have to worry about a rise in prices.
Summer is almost here, which will likely help boost future jobs reports as people seek out summer jobs.DONATE
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