The US Labor Market Is Tight, And Strong Consumer Demand Supports The Economy.

The tight labor market in the US shows that the future consumption of the US is still strong and the economy is not easy to fall into recession. According to the latest information from the Ministry of labour, there are 7 million 350 thousand vacancies in enterprises in this (2019) July, although it is lower than 7 million 630 thousand in the November (November) peak, but only 5 million 700 thousand people in the United States are looking for jobs, which are also lower than those in the April peak of nearly 6 million people. Job vacancies are about 1.3 times the number of job seekers. This data highlights that in recent years, it is difficult for American enterprises to find enough qualified employees, especially those with STEM (Science, technology, engineering and Mathematics) background.

The booming job market in the United States is also reflected in the willingness of workers to quit. In April, about 3 million 500 thousand workers left voluntarily, creating a record high in the past month. At the same time, the number of enterprises sacked remains at a record low. This shows that workers think jobs in the job market are easy to find. Once they find jobs with higher wages, they will job hopping. On the other hand, in order to find enough employees, employers can only be forced to attract talents with higher salaries.

The labor department's payroll data also showed a trend of simultaneous upward trend. The average annual growth rate of labor in the United States increased continuously after hitting 1.51% bottoms in October 2012, reaching 3.4% of the recent peak in February this year, and the latest July data still stands at 3.21%. This data is about two times of the latest consumer price index (CPI) 1.6%, which brings about a substantial increase in real wages and contributes to the improvement of real life quality. The growth of the average hourly wage also highlights the new employment opportunities in the US employment market. It is no longer a low wage job in the past retail or service industries, but an increasing number of highly paid professional posts.

Over the past decades, the employment market in the United States has been suffering from a downward trend in labor demand, which is globalized, factory automation, trade union strength, and a large number of enterprises outsourced. But now, as trump encourages enterprises to return to the United States and promote the US product law, the employment market in the manufacturing industry is also improving. The number of non-agricultural employment in July this year was 164 thousand, of which 16 thousand new jobs in the manufacturing sector became the focus of attention. It was even more valuable in the atmosphere of the US China trade war and the PMI index of the US manufacturing industry.

A significant improvement in the employment environment in the United States is a blessing for the young Americans with a high long-term unemployment rate. According to the information of the Saint Louis fed, the unemployment rate of young Americans aged 16-19 has dropped from 27.2% in October 2009 to 12.7% in June this year, while wages have increased by more than 10%. As the employment market continues to be tight, leading to more than 60% consumption of GDP, more and more economists believe that this will become a weapon to stop the US economy from falling into recession (or GDP decline for the two consecutive quarter).