It’s like that now.
employer Added There were 559,000 jobs in May, and more jobs were created in March and April than previous estimates suggested. The surprisingly weak April figure, which embarrassed economists four weeks ago (initially reported as an increase in employment of 266,000, has now been revised to 278,000), has seen a significant pace of recovery. It looks unusual, not downshifted.
But that doesn’t mean everything will work. Only a few weeks ago, the United States was likely on the brink of a booming summer, a period of explosive growth that would bring the economy back to full health faster than any memorable recovery. It seemed to me.
However, both anecdotal reports and data make it increasingly clear that vaccination facilitates resumption is more difficult than previously thought. The potential to add one million jobs a month seemed to be known a while back, but now it looks like wishful thinking.
It’s a hot summer rather than a hot summer.
On average, job creation over the last three months, employers add 541,000 positions a month. In a normal extension, that’s great. This is higher than what was achieved even in the first month of recovery that began in 2009. However, that does not mean that you will soon return to full health.
Given the job creation rates of the last three months, it will take 14 months to return to employment levels in February 2020.
Unlike a typical recovery, the problem seems to be supply, not demand for the labor force. Job vacancies have reached record highs and employers are eager to hire, but at least with the wages they’ve paid, they can’t find a worker.
The details of the May numbers confirm this idea. Wages are skyrocketing — average hourly wages have increased by 0.5%, but the proportion of adults in the working population has actually declined. The number of non-working people has increased by 160,000, “forget. Please, I’m not looking for a job. “
There was fierce debate as to whether this was the result of increased unemployment benefits and could reduce the incentives for people to work. Problems related to childcare and health risks related to Covid. Or perhaps a psychological reset of many workers.
These are not mutually exclusive. Everyone could be contributing to this extraordinary moment when demand for goods and services is skyrocketing and their supply is limited.
The open question is how much labor supply could increase in some states that end unemployment benefits expansion earlier than the September expiration date included in federal law.
Details of the industry that is increasing jobs also indicate a resumption of the struggle. The leisure and hospitality sector, which was the worst affected by the pandemic, added 292,000 jobs in May. This sounds great, but it’s actually slower than the 328,000 jobs added in April.
In other words, despite the fact that the country has been four weeks behind the spread of vaccination and all restaurants in the country seem to have complained about not being able to hire enough waiters, cooks and dishwashers in that sector. The pace of recovery slowed rather than accelerated …
Labor shortages are not necessarily a bad thing, as long as people reassess their priorities and act in their own best interests. This can lead to a more permanent reset of compensation and labor standards throughout the economy.
But it affects politics and the economy as a whole. For example, the Democratic Party wants to get into a boom in the interim period of 2022. If the labor supply turns out to be declining in the long run, it’s difficult to do so.
During this strange summer of reopening, the supply of many things, such as wood, computer chips, and used cars, was restricted. However, there is a big difference between these supply and labor supply issues. In other words, unlike wood and semiconductors, humans can choose.
As long as unemployment benefits and school closures are causing labor shortages, they should be resolved in time. The more extensively reconsidered the role of work in people’s lives, the longer this phenomenon will last than this summer after the pandemic.
Hot Vax looks slimy in summer
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