Continued improvement in U.S. labor market in 2014
Thanks David Nordfors for the heads up!
Good news, it seems – unemployment is going down, wages are going up.
The U.S. labor market continued to improve in 2014, with both a decline in unemployment and an increase in the share of the population employed; high levels of long-term joblessness and involuntary part-time employment, however, persisted.
Unemployment in the United States continued to decline in 2014, with the number of unemployed falling by 1.9 million over the year, to 8.9 million in the fourth quarter. The unemployment rate fell to 5.7 percent by year’s end—1.0 percentage point above the pre-recessionary rate of 2007.1 Employment, as measured by the Current Population Survey (CPS; see accompanying box), grew at a faster pace than it did the previous year, expanding by 3.1 million in 2014, and the employment-to-population ratio increased by 0.7 percentage point following a slight decline in 2013.2 The civilian labor force—the sum of the employed and the unemployed—grew by 1.3 million, reaching 156.3 million in the fourth quarter of 2014. The labor force participation rate, however, held fairly steady over the year.
This article summarizes changes in key labor market measures from the CPS during 2014, both overall and for various demographic groups. The article also examines changes in usual weekly earnings and in labor force status flows, and reviews the employment situations of veterans, people with a disability, and the foreign born.
Comment from Curt:-
We have a LONG way to go. Unemployment, as you know, is a funny metric. What really matters is how many people are working.—
Reply by David:-
Although the statistic represents a fraction of the people working, it seems the economy is recovering – Although the bigger issues remain ahead of us!
The upturn in the economy will only spur entrepreneurs maximizing the value of people by innovation, if anything.
From Bob Cohen:-
Yes, the recovery has been difficult but last year showed an increase in the total workforce and nearly 4 million net new jobs. Nice work after losing about 700,000 jobs a month after the financial crisis.
While investment is down in oil and gas, there are signs of a more sustained upswing in housing. Capital infrastructure firms like Caterpillar and Deere are using Big Data to drive hundreds of millions in cost savings and shifting spending to new analytics systems and new types of jobs. UPS and FedEx are using similar analytics systems to optimize truck routes and flight schedules with the trucking savings alone for UPS hitting about $600 million per year. With flights, savings for both could easily be a billion dollars per year each for FedEx and UPS. This is fueling more investments for new digital ecosystems.
Much of this is under the radar screen but it suggests that besides profits new technologies are freeing up funds for a broad digital revolution even at big firms (somewhat contrary to John Hagel’s contention that these big industries will fracture).
So that’s a bit of what some economists see happening, not just me. Perhaps not quite so long a way to go.
Reply from Curt:-
We are very slowly recovering. Growth this quarter was 0.2%—ug. We need to get above 3% to make a difference and make up for the past 5-8 years. I just came back from Singapore where I work with the government. They take a “different” approach and they are doing fine. They actually do nothing that would be surprising to this group, they just stick to the fundamentals of innovation, economics, and business and work to continuously improve. And guess what, it works. Pretty good for a country that was in poverty 40 years ago without any significant infrastructure and now has a PPP GDP per capita 20-30% above ours. And this with no water, resources, agriculture, energy, hardly any land, and many enemies. They do have a port, but they had to develop that too. They are not us, but we can learn a lot from them. The fundamentals work.