Critics of President Donald Trump have widely publicized the fact that the March 2018 Jobs Report showed that far fewer jobs were added during a one-month period than expected. In fact, only 103,000 new jobs were created in this month, while economists were predicting the addition of well over 180,000 jobs.
However, there is far more to the report than simply one set of numbers. A closer look at facts and details shows that while the figures aren’t perfect, they are not all entirely negative.
There are a number of positive factors in the report that are well worth rejoicing over. The unemployment rate has held steady at 4.1% for the sixth straight month. Average earnings have risen by eight cents per hour, and are up close to 3% over the past year. The jobs report also shows that the manufacturing sector is continuing to do well; in fact, more than 20,000 new jobs were created in manufacturing this month alone. The mining and healthcare industries are also hiring many new workers.
The fact that job growth in the first quarter of this year is stronger than it was during the same time period in 2017 seems to suggest that many people who have stopped working for one or more reasons, are now beginning to find jobs. Furthermore, economists are reporting that President Trump’s recent move to impose tariffs on imported steel and aluminum and China’s punitive tariffs imposed in response are not likely to have a dramatic negative effect on the job market. It is also worth noting the recent Tax Cuts and Jobs Act is likely to have a positive effect on the economy in the near future.
It is also important to note that while government policies and laws do have a large bearing on the job market they are not the only factor in determining the health of the economy at any given time. Statistics show that one reason why February’s job report was so astoundingly positive was that fact that unusually warm weather in many parts of the country led to the hiring of numerous construction workers for projects that are slated to begin in the near future. Retailers also tend to hire more staff members when the weather warms up as people head outdoors to shop.
Naturally, not all the data in the report is positive. Many construction and retail jobs that were created in February were eliminated in March as the weather turned cold. Wage growth slowed from January, and is weaker than expected given the fact that unemployment is so low. It seems that while there are plenty of job openings available, employers are trying to avoid offering pay raises and/or benefits for as long as possible in the hope that they will eventually find people who are willing to do jobs at current wages.
How long this situation lasts remains to be seen; however, if unemployment remains low then it is likely to eventually become a job-seekers market in which employers would compete to find the people they need for their business by offering good pay and/or added benefits. In fact, economists are predicting that the unemployment rate will fall in the coming months and labor force participation will grow, which mean it may only be a matter of time before companies are forced to increase pay for skilled workers.
The statistics from the most recent job report make it clear that the economy is not in perfect shape. There are flaws and weaknesses and these will need to be addressed if the economy is to experience robust growth both now and in the future. It is especially important for the government to look for ways to offer more ongoing tax relief for middle class workers and small business owners who often struggle to make ends meet even though they work hard day in and day out. Even so, the numbers aren’t all negative.
While fewer jobs were added this month than economists expected, the report also shows that sectors of the economy are growing now, and will likely continue to do so for the foreseeable future.
~ Liberty Planet