Mar 01, 2018

DCR National Temp Wage Index - March 2018

In January 2018, the U.S. economy added 200,000 non-farm jobs, according to the latest employment report by the Bureau of Labor Statistics. This marked the 88th month in a row that the economy has added jobs. The unemployment rate held steady at 4.1%. The growth in employment was driven by the construction industry, health care, restaurants, and manufacturing.

Average hourly earnings rose by 9 cents to $26.74, with a year-over-year growth of 2.9%. This is the highest rate of growth the BLS has recorded since June 2009.

Employment Growth in January 2018 by Industry (in thousands)

Source: U.S. Labor Department

The Labor Force Participation Rate

According to the BLS, the labor force participation rate has remained unchanged at 62.7% for four months. This rate includes all Americans who are either employed or actively seeking work but excludes those who want jobs but have given on searching for a job along with those who are not of working age.

Since its peak of 67.3% in 2000, the labor force participation rate has declined steadily. Some economists bleakly interpret this decline as meaning that a rising proportion of prime-age workers have been jobless long-term; these “discouraged” workers are able to work but do not believe the economy has a place for them. Other economists point to various significant factors driving down the rate, including the opioid crisis, video games keeping men from working, and rising disability rate particularly in poorer parts of the country.

Additional factors include the steady retirement of Baby Boomers and fewer working younger Americans as they’re seeking more education.

“The faster pace of wage gains indicates that the labor market is tightening, with employers having to pay higher wages to get the workers they want” ~David Berson, Nationwide Chief Economist