The American labor market suffered a terrible setback during and after the global financial crisis. The administration of Barack Obama concentrated its efforts on bringing the labor market back into a normal state, yet the percentage of the workforce (in regards to the total population) declined from 2008 up to 2015. While the percentage of people aged between 25 and 54 who were looked for a job in 2008 equalled to 83.1 percent, this indicator reached the lowest point in a decade in 2015: 80.7 percent. Now, the American labor market seems to bounce back, as the percentage of the workforce is steadily growing: 81.3 percent and 81.8 in 2016 and 2017 respectively.
A buoyant labor market where employers are hardly able to cope with a need to find employees continues to draw more and more workforce back. Thousands and thousands of Americans are being drawn back into the labor force. A resident of Georgia state said: “It’s a really great labor market. I like to be employed. I didn’t receive my Master’s Degree in order to simply sit at home.”
What is especially notable about the present-day American labor market is the fact that it starts to draw more less-educated workers in their first working years, considering that many of them have been previously discouraged and quit the process of job searching. Also, the figures of the Labor Department show that the markets has also shifted towards disabled, older workers, and teens.
Observers also draw attention to the fact that the return of those workers who had previously quit the labor market has offset the retirements of Babyboomers. During the first two summer months, for example, the labor market drew over 700,000 employees, getting the participation rate higher from 62.7 percent up to 62.9 percent. Robert Sockin, an economist at USB, says that the “strong labor market and the strong economy is prompting more and more people to return to the workforce.”
Employers are starving for qualified workers
Economists also point out that such an upward trend may have a significant influence on the growth of wages and interest rates. The fact that many workers return from sidelines helps to keep the indicator of 4.3 percent unemployment rate from diminishing even faster. Besides, shadow labor force may prevent business from raising average wages even faster, which could hurt the businesses otherwise and stir up inflation. Though, economists still ponder whether the Federal Reserve will attempt to make a third rise of interest rates in 2017.
Sockin also claims that employers are more likely now to consider low-skilled and less-educated workers, as the pool of the workforce is constantly shrinking. Besides, such an environment is especially favorable for immigrants. Sockin also stated that it is actually more women than men returning to the labor force, since the occupation rate is growing sharply in the sectors dominated largely by females (like health care and home health aides). As one job-seeker said about the American labor market after being asked about its state, “it is, indeed, a very candidate-driven market.”
The economic growth in the United States, by the way, accelerating as well.