Latest U.S. Labor Market Trends

May 8, 2015

The pace of labor market recovery has slowed in several respects.

  • The percentage rise in nonfarm payroll employment over the first four months of 2015, 1.66% at an annualized rate, was slower than its advances during the first third of 2014, 2013, 2012, and 2011.
  • Nonfarm payroll jobs increased less during the three months to April than in any previous three-month sequence since December 2013-February 2014.
  • The rate of unemployment fell 0.3 percentage points (ppts) during the past six reported months, down from a 0.5 ppt decline in the prior half year.
  • The 62.8% labor participation rate in April was unchanged from its level six months earlier in October 2014.  The ratio of jobs-to-population rose a mere 0.1 ppt in the same span and remains below the 60% threshold at 59.3%.
  • Average hourly earnings increased just 0.1% last month, and its 12-month 2.2% rate of rise was just 0.2 ppts above that seen six months earlier.
  • Broad unemployment, which includes under-employment and well as unemployment, remains close to 11% at 10.8%.

If nonfarm payroll jobs, which expanded at a 1.84% annual pace over the two decades between the end of 1979 and the end of 1999, continued to increase at the same pace through April 2015, its level now would be 172.609 million workers, 31.2 million employees or 32.2% greater than the actual level.  Both the amount of workers and their productivity — output per manhour — have slowed considerably.  Labor productivity rose by only 0.5% between the first quarter of 2012 and the first quarter of 2013, followed by advances of 0.6% each in the ensuing four-quarter spans to 1Q14 and then 1Q15.  The problem is not that Americans have lost their ingenuity, nor that the proliferation of applications of new inventions has bogged down.  The problem involves good work in the wrong areas, that is with the nature of what is being invented and how new ideas are being utilized.  A stress on consumer devices fails to enable workers to build more in less time.  It’s not enough that people are walking into accidents while staring down at their phones.  Now they are being tempted to do the same by starring at their watches.  Biotech firms are producing a pill for everything, prolonging retired lives but not lifting the longevity of average Americans, which trails that in many other countries.

Copyright 2015, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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