Category: Talent & Market Insights

The Numbers:

2.1 million: The economy added 2.1 million jobs in 2017
4.1%: The unemployment rate fell from 4.8 percent to 4.1 percent in 2017
2.5%: Hourly wages increased 2.5 percent in 2017

The Good

The U.S. economy saw continued growth in 2017, marking 87 straight months of growth, according to the New York Times. The 2.1 million jobs added in 2017 brought the unemployment rate down to a low that the U.S. hasn’t seen in 17 years.

The Washington Post reports that there is now nearly one job opening for every unemployed person in the U.S., with 6 million vacancies and 6.6 million unemployed people. While this is good news for anyone who is looking for a job, employers are struggling to fill open positions. Economists expect the job growth to continue into 2018, causing the unemployment rate to continue to fall.

The Bad

While the economy is still growing, that growth is slowing. According to CNN, the economy added nearly 3 million jobs in 2014, 2.7 million in 2015 and 2.2 million in 2016. The two weakest months for hiring in 2017 were March and September. However, economists attribute that to weather. March was cold and snowy, and hurricanes Harvey and Irma impacted hiring in September.

Retail hiring was another weak point in 2017. The retail industry shed 67,000 jobs. More than 20,000 were lost in December alone. The rise of e-commerce hit retails stores particularly hard in 2017.

Additionally, despite the continued job growth and falling unemployment, wage growth has remained sluggish. Economists have offered a variety of explanations; however, many expect increased wage growth to start soon. Some industries, particularly the finance and leisure and hospitality sectors are already seeing wage growth that is significantly higher than the national average.

Looking Toward 2018

Looking forward to 2018, economists expect more good news. According to the Wall Street Journal Economic Forecasting Survey, economists expect the unemployment rate to fall to 3.9 percent in June and 3.8 percent by December. They also expect the economy to add slightly fewer jobs than 2017.

As far as any impact from the tax bill, economists are skeptical it will have any immediate effect on either job or wage growth, according to Business Insider. However, according to the New York Times, 2018 could see more wage growth, as industries where they labor supply is tighter are seeing wages rise.

Review the monthly 2017 jobs reports to see how things changed month to month, and check back each month for our analysis of the 2018 jobs reports.

March 2017 Jobs Report
April 2017 Jobs Report
May 2017 Jobs Report
June 2017 Jobs Report
July 2017 Jobs Report
August 2017 Jobs Report
September 2017 Jobs Report
October 2017 Jobs Report
November 2017 Jobs Report
December 2017 Jobs Report

The Global Unemployment Report – Q3 2017

PeopleScout partnered with HRO Today to produce a quarterly summary of international unemployment metrics for key countries in North America, Latin America, EMEA and APAC, including highlighting the countries with the most highly skilled workers. This issue of the report focuses on Q3 2017.

The Labor Department released its December Jobs report with lower than expected job growth and an unemployment rate that remains at a 17-year low.

The Numbers

148,000: The economy added 148,000 jobs in December

4.1%: The unemployment rate remained at 4.1 percent

2.5%: Wages grew 2.5 percent over the past year

The Good

The 148,000 jobs added to the economy in December marks the 87th straight month of growth, the longest on record, according to Business Insider. The 4.1 percent unemployment rate also marks the third straight month at the 17-year low. Both numbers mark the end of another strong year of growth for the U.S. economy. Though the job growth fell below economists’ expectations, the number is still high enough to handle the number of people entering the job market and chip away at the unemployment rate, according to the Wall Street Journal.

The Bad

The biggest weight on December’s jobs report is the loss of retail jobs. Despite the growth in other sectors, the retail trade lost more than 20,000 jobs in December, most of those losses were in general merchandise stores. The New York Times reports that the rise of e-commerce hit especially hard this December. However, the retail sector has shed 67,000 jobs throughout 2017.

The Unknown

The biggest question that remains at the end of 2017 is when the sluggish 2.5 percent wage growth will begin to increase. According to the Wall Street Journal, some employers are feeling pressure to increase wages to retain employees. In 2017, the financial, leisure and hospitality and transportation and warehousing industries saw significant wage growth. While manufacturing has seen strong job growth, wage growth has been slow in the industry, falling short of the average at just 1.6 percent. According to one economist quoted by the Wall Street Journal, wage growth will be the indicator to watch in 2018.

The Labor Department released the November jobs report with higher than expected job growth and an unemployment rate remaining at a record low.

The Numbers

228,000: The economy added 228,000 jobs in November
4.1%: The unemployment rate remained steady at 4.1 percent
2.5%: Wages grew 2.5 percent over the last year

The Good

Both the job growth and unemployment rate signal a strong economy. The Wall Street Journal reports economists anticipated job growth of 195,000, so the numbers surpassed expectations. This is also the first jobs report since hurricanes Harvey and Irma that doesn’t show significant impacts from the two storms. The 4.1 percent unemployment rate remained unchanged from last month and is the lowest since December 2000. However, job creation is still slightly behind the pace of 2016.

The Bad

The weakest point in the November jobs report is the continued sluggish wage growth. The 2.5 percent increase has remained steady throughout most of 2017 despite a consistently dropping unemployment rate. According to the New York Times, economists have been expecting wage growth to pick up with falling unemployment, but so far that hasn’t happened. However, other economic indicators suggest that increased wage growth may be on the horizon.

The Unknown

The biggest unknown in the November report is the consistent question surrounding wage growth. Marketwatch suggests that the skills gap may be partially to blame because in highly skilled positions raising wages doesn’t create qualified applicants and employers “aren’t willing to pay for skills that people don’t have.” While the rest of the jobs report shows a strong economic picture, wage growth will be the number to watch.

The Labor Department released its October jobs report which shows the economy recovering from hurricanes Harvey and Irma.

The Numbers

261,000: The economy added 261,000 jobs in October
4.1%: The unemployment rate fell to 4.1 percent
2.4%: Wages rose by 2.4 percent in the last year

The Good

Both the 261,000 jobs added to the economy and the 4.1 percent unemployment rate confirm that the U.S. economy is recovering from both hurricanes Harvey and Irma. According to Business Insider, the 4.1 percent unemployment rate is the lowest in 17 years. Restaurants, bars and hotels accounted for most of the job gains. As we covered last month, most of the job losses in September were in the hospitality industry due to the hurricanes.

The Bad

The 261,000 jobs added in October fell short of economist expectations according to the Wall Street Journal. The New York Times reports that when looking at the broader trends in 2017, job growth has slowed compared to recent years. However, the rate is still enough to continue to push the unemployment rate down and bring new people into the workforce.
Meanwhile, wage growth slowed in October, after some indications in September’s report that it may start to accelerate. According to the New York Times, the numbers in October’s report were disappointing, even though many anticipated some impact from the hurricanes. Wage growth has stayed around 2.5 percent for most of 2017.

The Unknown

According to Bloomberg, most economists say the hurricanes are still distorting the numbers, so October’s jobs report doesn’t represent a complete picture of the U.S. economy. That trend could continue until the end of the year.
Additionally, the jobs report doesn’t reflect the impact of Hurricane Maria, as Puerto Rico is not included in the surveys.

The Labor Department released its September jobs report which shows major impacts from hurricanes Harvey and Irma.

The Numbers

-33,000: The economy lost 33,000 jobs in September
4.2%: The unemployment rate fell to 4.2 percent
2.9%: Wages increased 2.9 percent over the past year

The Good

Despite the 33,000 lost jobs in September, there are several bright points in September’s jobs report. The 4.2 percent unemployment rate is a new post-recession low. According to Business Insider, it’s the lowest since February 2001. Additionally, wage gains increased in September by 2.9 percent, which is higher than the steady 2.5 percent increases we’ve seen most of this year. That number could be skewed because low wage food service and hospitality workers who were out of work due to the hurricanes were not included in the figure. However, the New York Times reports that there are signs the labor shortage is starting to increase wages.

The Bad

September’s jobs report is the first time in seven years that the U.S. economy has shed jobs. However, the Wall Street Journal reports that economists say the number holds no weight because of the impacts of hurricanes Harvey and Irma. After Hurricane Katrina, the economy saw similar impacts, but those were temporary, resolving in about two months. The vast majority of the jobs lost were in food service and hospitality, which will likely return as Florida and Texas recover. However, economists did expect modest job gains of about 80,000 in September, so in that case, the job losses were worse than anticipated.

The Hurricanes

Because this jobs report is such an outlier due to hurricanes Harvey and Irma, it’s important to understand some of the numbers behind their impact. Although Hurricane Harvey hit in late August, it didn’t have a large impact on the August jobs report. According to the Labor Department, Texas and Florida account for about 7.7 percent of U.S. employment. Most reported job losses occurred in the food, tourism and hospitality in those states. The jobs will likely return, but since many of those positions are hourly and employees were not paid while the hurricanes shut down much of those industries, they are considered job losses. However, the Labor Department reports that the hurricanes had no impact on the unemployment rate.
Additionally, according to the Wall Street Journal, 1.5 million Americans reported that they had a job in September but were not working because of the weather. That’s the highest number since January 1996, when a blizzard hit the Northeastern part of the country, resulting in 60 deaths and causing $585 million in damage. This demonstrates the massive impact of hurricanes Harvey and Irma had on September’s jobs report.
Puerto Rico and the U.S. Virgin Islands, which both suffered significant hurricane damage, are not included in the Labor Department Survey.
We’ll have our analysis on the October jobs report when it comes out next month.

The Labor Department released its August jobs report with slower than expected job growth and a slight increase in the unemployment rate.

The Numbers

156,000: The U.S. economy added 156,000 jobs in August
4.4%: The unemployment rate increased to 4.4 percent
2.5%: Wages increased 2.5 percent over the past year

The Good

Rather than good or bad, a lot of the news in the August jobs report falls somewhere in the middle. After the strong numbers in July’s jobs report, the August numbers are more middle of the road. According to the Wall Street Journal, both the job gains and unemployment rate were disappointing according to economists’ projections. However, Marketwatch reports that the numbers still point toward a strong economy, and hiring numbers typically dip slightly in August.

The Bad

The weakest point in the jobs report again this month is the 2.5 percent wage growth. The fact that wage growth remains anemic despite consistent hiring and a low unemployment rate remains a bit of an economic mystery, according to the New York Times. Marketwatch reports that wage gains typically run 3 percent to 4 percent at this stage of an economic recovery. However, economists say there may be a number of factors holding wage gains down to 2.5 percent, including the retirement of highly-paid baby boomers and underemployment that’s still slightly higher than before the Great Recession.

The Unknown

The biggest unknown in the August jobs report is the impact of Hurricane Harvey. According to Business Insider, the hurricane happened too late in the month to be captured by government surveys. The impact will likely show up in unemployment filings over the next few weeks. In a separate article, Business Insider reports that Harvey will likely impact jobs reports over the next few months, distorting numbers for unemployment, job creation and even wage growth. Economists predict the impact will be fairly localized to Texas, but if people are displaced by the hurricane, like many were after Hurricane Katrina, the impact could spread to other cities.
The September jobs report will likely show the first signs of Harvey’s impact, as the Labor Department may revise some of August’s numbers, and the predicted spike in unemployment claims will likely occur. We’ll have our analysis of September’s jobs report when it comes out next month.

The Labor Department released its July jobs report with higher than expected jobs numbers and an unemployment rate that returned to a 16-year low.

The numbers

222,000: The U.S. economy added 209,000 jobs in July
4.4%: The unemployment rate fell to 4.4 percent
2.5%: Wages went up 2.5 percent over the past year

The good

The 209,000 jobs added in July is good news for the economy. According to the Wall Street Journal, this number is above the yearly average and shows that the economy is nowhere near slowing down as some had feared earlier this year. CNBC reports that the job growth exceeded economist expectations for the month, and most of the gains came in bars and restaurants, business and professional services and healthcare. Even retail, which has been an economic weak spot, showed some modest job gains in July.

The 4.3 percent unemployment rate is another positive, falling back to May’s 4.3 percent, the lowest unemployment rate in sixteen years. Last month the unemployment rate rose .1 percent, which economists attributed to more people entering the workforce. However, the Wall Street Journal reports that the difference between June’s unemployment rate and July’s unemployment rate is only a rounding difference, and the unemployment rate is essentially unchanged.

The bad

There is a lot of good in this jobs report, but the weakest point is the 2.5 percent wage growth, which has been a common theme throughout mid-2017. Wage growth has remained around 2.5 percent even though Marketwatch reports that wages typically rise 3 percent to 4 percent when the economy is running at full throttle.

The unknown

The question for economists in this report is why wages are only showing modest growth when other signs indicate that the labor market is tightening. According to Marketwatch, it could be a number of factors, and likely a combination of low productivity, global competition and a reluctance of Americans to change jobs after the Great Recession. The New York Times reports that the slow wage growth may cause the Federal Reserve to tighten monetary policy more quickly.

We’ll have our analysis of the August jobs report when it comes out next month.

The Labor Department released its June jobs report with better than expected job growth and signs that point to increasing labor force participation. Here’s what we know:

The numbers

222,000: The U.S. economy added 222,000 jobs in June
4.4%: The unemployment rate rose to 4.4 percent
2.5%: Wages went up 2.5 percent over the past year

The good

The 222,000 jobs added is good news. According to the Wall Street Journal, it’s the largest increase since February, and it’s even larger than economists were expecting. This helps quash some of the fears about slowing job growth that we talked about after the May jobs report.

Additionally, even though an increase in the unemployment rate may not seem positive, it’s a sign that more people are entering the job market. Marketwatch reports that’s typical for the month of June, as the flood of new college grads enter the job market, though modest gains in labor force participation indicate that some workers sidelined during the recession have gained the confidence to re-enter the job market.

The bad

The 2.5 percent wage increase is a familiar number for economists. Bloomberg reports that while hiring has accelerated throughout the recovery from the Great Recession, wage gains have remained modest. Economists had expected wages to increase as the unemployment rate fell. So far, that hasn’t happened.

The unknown

The biggest unknown is why wage gains continue to disappoint. The New York Times reports it may be a sign that the economy is not yet nearing full employment like some had predicted and still has room to grow. Bloomberg reports that the growing labor force participation could be keeping wages down, but other economists point to the retirement of high-earning Baby Boomers who are being replaced by the lower-earning millennial workforce. Marketwatch also points to the possibility of decreased productivity and increased global competition.

Read our analysis of the July report here.

The Labor Department released its May jobs report with the lowest unemployment rate in 16 years but lower than expected job growth. Here’s what we know:

The numbers
138,000: The economy added 138,000 jobs in May
4.3%: The unemployment rate fell to 4.3%
2.5%: Wages went up 2.5% over the last year

The good

The unemployment rate is the highlight of the May report. The Wall Street Journal reports that this is the lowest level since 2001. Broader measures of unemployment and underemployment are also down, and it’s also down from the April jobs report.

The New York Times reports the numbers show we’re nearing full employment, but depending on who you are, that may or may not be a good thing.

The bad

Despite the banner unemployment headline, economists say this report sends some mixed signals about the economy. First, the Wall Street Journal reports the 138,000 jobs added was actually lower than economists expected, and Bloomberg reports the past three months show the slowest job growth since 2012.

Additionally, part of the reason for the decreasing unemployment rate is a shrinking labor force. The New York Times points out that the labor-force participation rate dropped this month to 62.7%, which indicates that workers sidelined during the recession are not rejoining the labor force despite years of job growth and a low unemployment rate.

The 2.5% wage gain has been steady since late 2015, according to the Wall Street Journal. Economists had predicted that would eventually start to increase with the falling unemployment rate, but so far, that hasn’t happened.

The unknown

Economists are debating what exactly these mixed signals mean when looked at as a whole picture. Marketwatch reports that the low unemployment rate will be enough for the Federal Reserve Bank to increase interest rates. However, they also show the report caused the dollar to weaken and the stock market gains were limited.

Read our analysis of the June jobs report here.

The Labor Department released its April jobs report with higher than expected job growth, showing a rebound after a slow March. Here’s what we know:
The numbers
211,000: The economy added 211,000 jobs
4.4%: The jobless rate fell to 4.4%
2.5%: Wages went up 2.5% over the past 12 months
The good
There’s a lot of good in this jobs report. The 211,000 jobs added is more than economists expected according to Marketwatch, and it’s more than double the growth in the March report.
Additionally, the 4.4% unemployment rate is the lowest in nearly a decade. According to the Wall Street Journal, the last time the unemployment rate was 4.4% was May 2007. The last time it was lower was May 2001. The number suggests the economy may be near full employment.
The bad
While not necessarily bad, one of the weaker points in the report is the 2.5% wage increase. According to the New York Times, it’s a sign that the economy hasn’t actually reached full employment. However, Bloomberg reports wage gains should be the next step in the continued recovery from the recession, citing the tightening labor market.
The unknown
The biggest questions out of the April jobs report concern what exactly the results mean for other parts of the government. Marketwatch reports the job growth keeps the Fed on track to raise interest rates again soon.
The April report also clears up some questions after March’s surprisingly low job report, according to Marketwatch. Their analysts say April’s strong numbers show March was likely an anomaly caused by bad weather.
Read our analysis of the May jobs report.