Page 22 - The South China Business Journal
P. 22
C. Today Picture from U.S. Chamber of Commerce
Full Employment’s
Surprising Implications
By Dr. J.D. Foster, Senior Vice President, Economic Policy Division, and Chief Economist of U.S. Chamber of Commerce
American labor markets are finally turning the about 75,000. If we’re really at full employment today,
page on the GGR and the OTR – that would be why is the reported monthly job growth still much higher?
the Great Global Recession and the Obama Tepid Because “full employment” isn’t a fixed point of reference.
Recovery. By just about every measure, eight years after
the recovery began the U.S. economy is at long last at or Let me explain. Some Americans who want to work
very near full employment. remain out of the workforce, but are steadily drawn in as
the job market tightens. As they re-enter the workforce
It’s been so long, this return to full employment may and find jobs, they bump up the growth rate of hirings
come as something of a shock to policymakers and and of the overall labor force. For example, in the Labor
businesses alike. Department’s monthly household survey about 1.6 million
individuals identify themselves as not in the workforce,
One implication of this new happy reality will be the but willing and available to work. This figure has dropped
downshifting in job growth, which will almost surely be by about 200,000 over the last year. The comparable figure
misinterpreted initially as a sign of trouble and cause prior to the recession was about 1.5 million, suggesting this
for worry. It will be neither, but it will have very real source of additional labor will be tapped out early in 2018.
consequences for economic growth going forward.
Another group of Americans want to work full time
Job growth averaged 187,000 from June of 2016 to June but can only find part-time jobs, and their ranks are
of 2017. Over the previous 12-month period, job growth thinning, too. About 5.3 million Americans fit this
averaged 202,000 and 240,000 the previous twelve category, a figure that has fallen by about 500,000 over
months. Over the same period the unemployment rate the past year. Prior to the recession, the comparable
dropped from 5.4 percent to 4.9 percent to 4.4 percent. figure was about 4.4 million.
As labor markets moved toward full employment, the
number of workers available for hire has fallen. Taken together, these figures suggest if job growth
continues into the future at the same pace as the nearly
Roughly speaking, once the economy is truly at full 200,000 jobs gained on average over the past three
employment then monthly job growth will likely average months, then the last elements of real slack should have
20 AmCham South China
Full Employment’s
Surprising Implications
By Dr. J.D. Foster, Senior Vice President, Economic Policy Division, and Chief Economist of U.S. Chamber of Commerce
American labor markets are finally turning the about 75,000. If we’re really at full employment today,
page on the GGR and the OTR – that would be why is the reported monthly job growth still much higher?
the Great Global Recession and the Obama Tepid Because “full employment” isn’t a fixed point of reference.
Recovery. By just about every measure, eight years after
the recovery began the U.S. economy is at long last at or Let me explain. Some Americans who want to work
very near full employment. remain out of the workforce, but are steadily drawn in as
the job market tightens. As they re-enter the workforce
It’s been so long, this return to full employment may and find jobs, they bump up the growth rate of hirings
come as something of a shock to policymakers and and of the overall labor force. For example, in the Labor
businesses alike. Department’s monthly household survey about 1.6 million
individuals identify themselves as not in the workforce,
One implication of this new happy reality will be the but willing and available to work. This figure has dropped
downshifting in job growth, which will almost surely be by about 200,000 over the last year. The comparable figure
misinterpreted initially as a sign of trouble and cause prior to the recession was about 1.5 million, suggesting this
for worry. It will be neither, but it will have very real source of additional labor will be tapped out early in 2018.
consequences for economic growth going forward.
Another group of Americans want to work full time
Job growth averaged 187,000 from June of 2016 to June but can only find part-time jobs, and their ranks are
of 2017. Over the previous 12-month period, job growth thinning, too. About 5.3 million Americans fit this
averaged 202,000 and 240,000 the previous twelve category, a figure that has fallen by about 500,000 over
months. Over the same period the unemployment rate the past year. Prior to the recession, the comparable
dropped from 5.4 percent to 4.9 percent to 4.4 percent. figure was about 4.4 million.
As labor markets moved toward full employment, the
number of workers available for hire has fallen. Taken together, these figures suggest if job growth
continues into the future at the same pace as the nearly
Roughly speaking, once the economy is truly at full 200,000 jobs gained on average over the past three
employment then monthly job growth will likely average months, then the last elements of real slack should have
20 AmCham South China
