Does The U.S. Have A Labor Shortage?

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Near record unemployment rates and an increase in help wanted signs would suggest that there is a labor shortage.  If this is the case, we should be seeing the signs of a tight labor market, with wage growth and inflationary pressures.  Surprisingly, wage growth has been modest and inflation has been relatively benign. What is … Continued

Is Labor-Force Participation Improving?

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We have previously discussed the importance of labor-force participation (see blogs from 09 Jan 2018 , 16 Mar 2018 and 18 May 2018 ). Recent data suggests that the labor-force participation rate has started to improve, probably thanks to a strong economy and significant increases in the de facto minimum wage, to approximately $15 per … Continued

Labor-Force Participation, Revisited

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We have previously discussed the importance of labor-force participation (see blog from 09 Jan 2018).  The recently reported February jobs report was probably about as good as it gets. Nonfarm payrolls grew by 313,000, the unemployment rate held steady at 4.1%, wages grew by a too modest 0.1% and, most important, the labor-force participation rate … Continued

Labor-Force Participation

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Since the turn of the century, U.S. labor-force participation has been weakening.  There have been numerous attempts to explain this phenomenon, with little agreement.  Most of the theories have revolved around inadequate pay, increased safety net benefits such as disability payments, and the thought that a recovering economy would solve the problem by encouraging greater … Continued

Involuntary Part-time Work

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The economy is continuing to add jobs and the U.S. April jobs report was generally positive.  On the plus side, the unemployment rate of 4.4% would suggest that the country is at, or near, full employment.  However, as noted previously, the labor force participation rate remains near record lows at 62.9%.  This is troubling, as … Continued

The Skills Shortage

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Currently, U.S. jobs data suggests that overall unemployment is relatively low, underemployment remains an issue, labor force participation is relatively low and there appears to be a significant skills mismatch, which is likely to get worse. Anecdotal evidence suggests that millions of jobs stand empty because employers are unable to fill jobs that are in … Continued