“Astonishing labor market growth”
Headlines at the New York Times and Washington Post trumpet 25 straight months of job growth. Unexpected jobs numbers Friday show the unemplyment rate falling to 3.4 percent, a rate not seen since 1969.
The Bureau of Labor Statistics reports that the economy added 517,000 jobs last month. The labor force participation rate remained stable at 62.4 percent but below pre-pandemic levels. But wage growth is slowing with inflation.
Despite claims that employers cannot find workers because “nobody wants to work these days,” restaurants cannot find workers because many have found better jobs with “increased flexibility, stability and often better pay” (Washington Post):
Nearly three years since the coronavirus pandemic upended the labor market, restaurants, bars, hotels and casinos remain short-staffed, with nearly 2 million unfilled openings. The leisure and hospitality industry, which before the pandemic accounted for much of the country’s job growth, is still short roughly 500,000 employees from 2020 levels, even as many other sectors have recovered.
Direct customer-contact jobs (you may have noticed) are understaffed since the pandemic.
“There’s been a shift away from the sectors where we have the most person-to-person contact,” said Nick Bunker, economic research director at the jobs site Indeed. “It feels like no one’s working, even though we can tell from government statistics that they are.”
In such a market, workers may shun low-pay jobs with volatile work schedules and limited hours. Perhaps the gloss has dimmed on the supposed “gig economy” sold as entrepreneurship by employers looking to minimize labor costs and avoid paying benefits.
“The people who used to work in restaurants have gotten new jobs,” the manager of Atwood’s Tavern in Cambridge, Mass., tells the Post. “They’ve all moved on.”
The numbers won’t change the partisan lean of opinions on the economy. See here.
UPDATE: That wage growth slowing with inflation? Timothy Noah notes that that’s nominal, not adjusted for inflation: “In 2022, real private wages declined 1.2 percent, even though inflation was coming down during the second half of that year. The only good news is that since September, inflation has been falling much faster than quarterly wage growth.” Power is shifting back to employers.