Increasing challenges finding workers
NEW YORK – Starting the year on a strong note, the U.S. economy added 225,000 jobs in January and the unemployment rate ticked up slightly to 3.6 per cent.
The Feb. 7 job report provides more evidence of accelerating employment growth, with the last three months averaging 211,000 new jobs.
Stronger employment growth may reflect growing confidence of employers, as some of the geopolitical risks — such as the U.S.-China trade spat — subsided in recent months.
Amid stagnant growth in the working-age population, strong employment growth will likely further tighten the labour market in 2020. As a result, Gad Levanon, Vice President of Labor Markets, U.S. Bureau of Labor, said the Conference Board expects increasing challenges around recruitment and retention, higher labour cost growth, and a further squeeze on corporate profits.
The tightening labour market continues to draw more people into the workforce, especially women. The labour force participation rate of women aged 25-54 reached 77 per cent in January. That marks a near-record, just shy of the record rate in April 2000. The improvement in labour force participation will partly offset the impact of strong job growth, slow further tightening in the labor market, and help fuel continued employment and economic growth.
While in general, strong employment numbers raise the likelihood of an interest rate hike, experts think the probability of the Federal Reserve doing so is still extremely low.
-Yerson Retamal photo
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