Jobs Report Shows 2017 Ended on a Strong Note
Ball State economist Michael Hicks says the national employment report released on Friday shows that 2017 ended on a strong note.
But, he adds, it’s clear that the number of available workers to fill positions is dwindling.
The US Labor Department announced on Friday that 148,000 jobs were added last month with an average of 204,000 over the last three months. The report also said nation’s unemployment rate was 4.1 percent in December, the same as in November. Average hourly earnings increased by 9 cents, to $26.63, an increase of 2.5 percent in the last year.
“Yes, the year ended on a strong jobs report, but with 148,000 new jobs total employment growth was not as robust as in recent months,” said Hicks, director of Ball State’s Center for Business and Economic Research (CBER). “This is not surprising given that the labor force rose by only 60,000 workers. At the current level of unemployment, job growth is likely to continue to be constrained by the supply of available workers.
“Though the median period of unemployment is shortening,” Hicks added, “there is a small but persistent share of workers who are unemployed for more than six months. This implies that there remain pockets of much worse labor market performance.”
Hicks notes that several data points signaled real strength in this jobs report. First, the composition of employment was strong, with an end of year surge in manufacturing hiring.
With 25,000 factory jobs created, it is almost certain that fourth quarter 2017 was the record month for manufacturing production, he said.
Hicks also pointed out that 2017 ended with wages rising faster than inflation for 2017. The economy-wide average wage gains most likely mask a great deal of different growth rates across different skill levels.