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Employers created 263,000 new jobs in the US economy in April – again surpassing economic forecasts, according to the latest jobs report released by the Bureau of Labor Statistics.
All new hires in April, as well as the increase in the number of people leaving the labor force, further reduced the unemployment rate, which was already extremely low, to 3.6%. This is the lowest US unemployment rate since December 1969.
Yet the smallest pool of available workers did not translate into much higher pay: workers only benefited from an increase in their average hourly wage of 6 cents in April. A month earlier, wages had increased by 4 cents.
The new employment report shows that the US economy continues to grow, but that middle-class and working class families do not benefit much. Job security is one of the benefits that employees can count on.
The low unemployment rate and the high number of jobs created mean that almost all Americans who wish to work and are able to land a job at the present time. And those who lose their jobs or decide to leave will probably have no difficulty finding another job.
Most of the new jobs created in April were for business services, construction, health care and social assistance.
Although all new hires are good, the numbers are not as high as those of last year. The average monthly employment growth over the past three months was about 169,000, which is below the monthly average of 223,000 over the same period in 2018. The decline is not alarming; this simply suggests that the current shortage of manpower prevents employers from filling all vacancies.
But with such a tight labor market and rising productivity, workers should expect wage increases well above what they are getting.
Businesses are super stingy
Even though Americans find jobs quite easily, they still do not see the so-called "economic boom" reflected in their portfolios.
April was another month with disappointing wage growth.
Private sector workers (excluding farm workers) benefited from an increase in their average hourly wage of 6 cents, which corresponds to an average hourly wage of $ 27.77. In the last 12 months, average hourly earnings increased by only 3.2%, which does not even account for inflation.
The latest wage data suggests that workers and unions will continue to strike to force companies to raise wages.
Sluggish revenue growth was the weakest part of the US economy in its recovery from the Great Recession. Wages have barely kept up with the cost of living, even though the unemployment rate has dropped and the economy has grown.
The increase in the average hourly wage of 6 cents in April seems more or less the same, despite a surprising jump of 10 cents in February.
Over the last year, the cost of food and housing has increased, forcing paychecks to stretch further. However, due to the recent drop in gasoline prices, the annual inflation rate has been reduced to 1.9%, compared to 2.4% in January 201 (based on the previous year). ;consumer price index).
Thus, taking into account inflation, real wages of workers have only increased by about 1.3% in the past year. It's faster than their growth since the start of the recession in 2007, but it's still pitiful when compared to the exorbitant amounts obtained by corporate CEOs.
Frustration over stagnant wages is also the main factor behind the widespread workers' strike across the country, including California, Illinois and Missouri. Last month, 31,000 supermarket workers went on strike in the Northeast to cancel proposed wage cuts and higher insurance premiums. The Stop & Shop strike in mid-April has been the largest private sector work stoppage in years. After eight days in empty supermarkets, the company agreed to give up its plan.
Some economists are convinced that wages will start to rise if this trend continues. "[T]The sharp increase in the number of workdays lost due to strikes on wages and benefits over the last year suggests that employees are increasingly recognizing that the balance of power has changed in their favor, "he said. Ian Shepherdson, Chief Economist, Pantheon Macroeconomics. Friday in an analysis.
The widespread labor unrest underscores the fact that the Republican tax cuts have hardly helped working-class families, despite all the promises of congressional Republicans.
In response, voters in some states forced companies to pay a salary increase to lower-paid employees.
In the mid-term elections in November, voters in Missouri and Arkansas overwhelmingly voted to increase the minimum wage for nearly a million workers in both states. And thanks to the new laws, low-wage workers in 19 states got wage increases on January 1.
These laws have helped raise wages up to now in 2019, but not enough.
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