US Unemployment rate has gone down to a seven year low of 5.3 percent as employers have hired an ample of workers in the month of June. However, the wages are pretty flat and it has also resulted in people becoming complacent in looking for jobs.
The figures were released on Thursday and it reflects the uneven nature of the market recovery from the Great Recession. According to Scott Andersen, the chief economist at Bank of the West, “The job market remains consistent with a two-steps-forward, one-step-back expansion the U.S. economy finds itself in”.
As many as 223,000 jobs were created last month and it has helped the US economy by a great deal. According to the Labor department, the unemployment rate went down to 5.3 percent in the month of June as compared to 5.5 percent in May.
Since April 2008, this is the lowest unemployment rate in the US. Back in 2008, it was 5 percent, but it hiked to 10 percent in the year 2009 majorly due to the impact of the Great Recession. The drop in the unemployment rate can also be attributed to the fact that people gave up looking for the job after getting discouraged. Unless people are actively searching for a job, the government doesn’t count them as unemployed.
The number of Americans looking for work has also gone down a fair deal and it has experienced a 38 year low. The wages are also ordinary and they have risen by only 2 percent over the last 12 month period.
According to Tara Sinclair, the chief economist at the jobs site Indeed and a professor at George Washington University, “After this report, I think it would make sense to wait until December to start that slow rate increase.”
The stalled wage growth implies to the fact that employers are not seeking to retain the workers or raise their pay. The reason is simple; there are more people available for hiring than the figures indicated by the unemployment rate.
In the last three months, the hiring average has gone to 221,000 per month. This shows the confidence that employers have in the upcoming market trends and consumer demands.