The creation of new jobs is always a big political battle of which party can do the best. So far during the month of October 261,000 jobs were created which is down from the predicted 310,000. This isn't a big deal to economists because of the hurricane damage through the month of September possibly holding up the creation of jobs in some parts of the country. Economists even say the country is doing better than industry expectations which is good news for now. One problem found during the month of October is the wage growth rate is down from 2.4% to 2.8%. Which is big news as the fed is reportedly planning an interest rate hike in December to combat inflation pressures. It will be interesting to see what the month of November brings as many changes are being put into place for the countries economy.
https://russellinvestments.com/us/insights/market-week-in-review?gclid=EAIaIQobChMIopy2oLO61wIV2IqzCh2wnQI8EAAYASAAEgIjLfD_BwE
This is a very interesting article. As it implies above, we are getting mixed signals on the health of the economy. On one hand, we had positive job growth and increase in economic productivity, but we had slow down in wage growth.
ReplyDeleteWages is one of the most important aspect of the economy and it can be a huge sign as to the future of the economy. If businesses and the government cannot figure out how to increase wages, then we could start to experience a labor shortage, as workers won't be willing to work for the lower wages.
I am unsure what the Fed will do to encourage wage growth. As we know, interest rates have been at an all-time low and yet, inflation has continued to stay below the Fed's target level.
I think temporarily it's likely that we will see a spike in jobs this year. We will gain temporary construction jobs to rebuild the areas affected from natural disasters, as well as new jobs from businesses moving into the US due to the attractive new corporate tax rate.
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