The wide-ranging effects of the lowest unemployment rate in five decades
The unemployment rate was recorded at 3.5 % in December 2019. The labor force participation rate was unchanged at 63.2%. For the first time in 11 years, four-fifths of all Americans in their prime working years have a job.
Prime-age workers are big home buyers and consumers compared to younger Americans just starting out, those nearing retirement or people who’ve already retired. They play a huge role in how fast the economy grows. The percentage of these people holding a job had fallen to a 26-year low of 74.8% after the 2007-2009 Great Recession.
In some parts of the US, the low unemployment rate is becoming a real issue. Some small businesses have had to close other locations or some days in the week owing to the labor shortage as the workers keep hopping job to job tempted by better wages.
The U.S. is looking at growth rates around 1.7% to 2.1% which are on the low side of respectable. If we had the workforce we need that rate might be closer to 2.5%. However this is not indicative of any recession coming later this year.
Immigration restrictions have affected construction and transportation more than manufacturing. The construction sector has been as much as 40% dependent on immigrant workers in the past and most of them were legal.
Additionally, the Fed slashed slashed rates three times in 2019. They are now at 1.75%, which may be very close to record lows.
The U.S. economy gained 266,000 jobs in November 2019 and 145,000 in December according to the U.S. Bureau of Labor Statistics, further evident that there were strong jobs gains across the board pushing wage demands higher.
If your company is interested in comparing its compensation levels with others like it then please participate in the 2020 Compensation & Benefits Study. This biennial benchmarking study is conducted by Industry Insights, ASA’s third party affiliate (All data is maintained confidential). The 2018 ASA Cross Industry Compensation analyzed data of 1,037 different wholesale-distribution firms from across the U.S., including the PHCP-PVF supply chain, with a combined total of more than 9,500 locations.
If you are interested in participating or to learn more please contact Ayesha Salman (Business Intelligence Analyst) @ 630-467-0000 Ext: 212 or email@example.com