No fooling, Americans are feeling more confident in the job market than anytime since the Great Recession. In March the U.S. added a robust 215,000 jobs, crushing expectations and raising the labor participation rate. Though it seems counter-intuitive, the influx of workers back into the labor pool actually raised the unemployment rate from the previous eight-year low of four-point-nine percent to five percent. Job creation has averaged 209,000 jobs per month over the last six months.
The gain in the labor participation rate, up to sixty-three percent, was the first in two years as more of America’s long term unemployed are headed back to work. The jobs market is also changing the expectations of workers when it comes to being able to find a new job. The job market is hot and Americans are starting to take notice.
Job Prospects Looking Brighter
Today over half of all workers, fifty-three percent, believe they would be able to find a comparable job within six months if they were to get a pink slip. Along with expectations of being able to find another job comes increased expectations for raises and better workplace perks. Workers in the U.S. aren’t just looking for another job, they’re looking for a step up from where they are now and, in many cases, they’re getting it.
Huge Jump In The Labor Force
Adjusted for population and smoothed out for changes in the population, the labor force increased by 2.2 million. That’s the biggest jump since 1948 as the American economy changed gears from war machinery to infrastructure growth. The previous record labor force jump was set in 1973 and stood for a generation.
Feeling Good
Worker confidence about the job market and getting a raise is at a seven year high. Another bright spot in the job number is called the “quits rate” which tracks how many people quit their job to go look for a better one. Another term might be the “take this job and shove it” rate. The quits rate jumped to two percent, which means people are confident of being able to find work before they even start looking for another job.
Some Caveats To The Numbers
As usual there are some caveats to the overall bright jobs picture. As mentioned above, the Bureau of Labor Statistics makes adjustments to the population based on a number of factors which can make the monthly numbers difficult to compare. It should also be noted that most of the job gains came in retail and restaurants, which tend to be jobs and not careers. In fact, according to a 2015 report, cashiers made up six percent of the U.S. workforce. That is not exactly a dream job for many people.
There was an increase in hiring in the construction and healthcare fields, which is good news but there was a decline in manufacturing jobs. The loss of manufacturing jobs, which many blame on free trade agreements like NAFTA, was the one sour note in the report and quickly became a central campaign issue in the 2016 presidential primaries. The truth about free trade and jobs is somewhat murkier.
The truth is manufacturing jobs in the U.S. peaked in 1979, decades before NAFTA and twenty years before China became a member of the World Trade Organization. Certainly U.S. manufacturing jobs have been battered by outsourcing, but also by automation technology and the declining power of unions. Unfortunately for this election cycle, that more nuanced reality doesn’t fit on a bumper sticker.