"The U.S. labor market has experienced the most chaotic year in history. ”
The Washington Post's Dec. 29 report used 10 tables to try to describe the chaotic labor market in the United States in 2021. The newspaper said that under biden's trillions of dollars of stimulus, the US economy has seen an unexpected "recovery.". But under the whack of the epidemic and inflation, the United States has also seen unprecedented problems: although companies continue to raise the basic salary, the unemployment rate and resignation rate continue to reach new highs.
Screenshot of the Washington Post report The source of this article is from the newspaper
Economic "recovery"?
The Washington Post began its report by writing: A year ago, the U.S. job market was very weak, with an unemployment rate of 6.7 percent, 21 million people unemployed, and 10 million fewer jobs than before the epidemic. Previous expectations were that the labor market could take years to recover due to anxiety about the pandemic and reluctance of badly damaged businesses to hire.
But the U.S. economy has recovered unexpectedly under the "blood transfusion" stimulus of the Biden administration's money: in 2021, the U.S. economy recovered rapidly, and the demand for workers in businesses rebounded at a speed almost never seen before. The U.S. unemployment rate was 4.2 percent in November, the fastest recovery since World War II and since the recession in the Mid-1960s.
As for the reasons for the economic recovery, the Washington Post commented that this is mainly due to the Biden administration's multiple rounds of stimulus programs totaling at least $5.2 trillion. At the same time, the Fed continues to keep interest rates close to zero and inject hundreds of billions of dollars into the economy. Many of these measures directly inject money into Americans' bank accounts. The lowest-income Americans have nearly twice as many bank deposits as they did before the pandemic.
Subsidies from Congress and the Federal Reserve have led to a sharp pick-up in American spending. The vast majority of those spending goes to buying merchandise, from cleaning supplies and household appliances to videos like burgers and milk. Spending on services such as hospitality and restaurants saw only modest growth.
However, this economic "recovery" based on "throwing money" has also brought problems.
Demand for U.S. labor has recovered, but the number of workers willing to work has declined
The economic recovery in 2021 the unemployment rate recovered quickly, but the recovery in employment was slow
Biden's "big blood transfusion" stimulus package has boosted economic recovery
Personal consumption expenditure rebounded to pre-pandemic highs
Labor shortages
The surge in spending brought about by the economic recovery has created new demands across the labor market, and the demand for recruiting workers in various industries in the United States has soared, such as warehouse and truck drivers. At the same time, service enterprises are also facing fierce competition for new labor.
But new problems arise, and millions of people are reluctant to enter the labor market despite all the efforts companies are doing their best to recruit. But the resulting labor shortage is causing serious problems for a range of industries: restaurants can't find waiters, to factories to find assembly line workers, to hospitals to find nurses.
Early retirement became the main cause of labor shortages
During the massive layoffs in 2020, a large number of Americans left the labor market, a common pattern during economic downturns. But more often than not, as the economy recovers, people start looking for work again. This time, though, millions of people are reluctant to enter the labor market.
Government statistics show that the number of jobs in the United States is still about 3.5 million fewer than two years ago, but only a little more than half of that number — 1.8 million — have joined the job search army.
Daniel Zhao, a senior economist at jobs website Glassdoor, said: "I think many economists have been predicting in 2021 that this month, the unemployed workforce will suddenly return to the workforce, whether because of vaccines or students returning to school. But that didn't happen at all. ”
retire
As for the reasons for the labor shortage, the Washington Post cited data from a survey and found that a large number of middle-aged and elderly workers choose early retirement as one of the reasons for the decline in the total labor force.
Since May 2020, the U.S. Census Bureau has launched a special survey called the Household Pulse survey, asking why unemployed people don't look for work. In the beginning, many people were afraid of contracting the new crown virus. But as the U.S. economy recovers, that reason is no longer the primary reason for labor shortages.
The reason why 38% of the unemployed do not participate in the labour market is retirement
The latest survey in October 2021 shows that early retirement has become the most important reason for the unemployed not to look for a job, while only 5% of people are afraid of contracting the COVID-19 pandemic.
For some, the soaring value of retirement accounts and housing, combined with low spending on a work-from-home lifestyle, makes early retirement economically viable, according to the Washington Post analysis. Still others retire entirely on Social Security and do not have retirement accounts to ease the burden.
An analysis by the Washington Post found that by November 2021, the number of people actually retiring was more than 1.5 million more than expected based on pre-pandemic trends. While the employment participation rate of young people aged 16 to 24 has also increased, this is still not enough to offset the number of older employees leaving.
Retirement isn't the only cause of labor shortages. The Census Bureau survey also pointed to a number of other reasons. Some economists argue that while government welfare stimulates consumer spending, it also makes more Americans reluctant to return to work. But now that those benefits are over, more Americans are likely to go looking for work.
The number of people actually retiring is more than 1.5 million more than expected based on pre-pandemic trends
Fewer people over the age of 45 have a job or want to work
Low-end jobs and immigration are decreasing
In addition to retirement, Americans also tend not to work in services such as transportation workers, waiters and nurses.
Since the outbreak, nurseries have been heavily lost and often unable to pay higher wages like competitors; understaffing in public schools can ripple through the economy; job openings in industries such as restaurants, hotels and retail have reached or approached historic highs; and labor shortages in nursing homes and residential care facilities have been the worst, the only industry where employment has fallen sharply since May 2020.
Corporate pay raises have failed to reverse this decline, and while many are passing those spending on to consumers in the form of price increases, most workers' incomes have grown faster than inflation over the past two years. Revenue for non-managers at the lowest-paid gas stations rose 15.9 percent to $14.58.
The Washington Post said that the labor shortage raises a stark question: To what extent can some of America's most important industries continue to rely on cheap labor?
Wages for low-income workers have increased
The industry with the highest turnover rate in October 2021
The decline in overall population growth has been accompanied by a sharp decline in the number of immigrants
The data shows that low-end labor is underemployed, and the epidemic has exacerbated the long-standing demographic crisis. Population growth is slower than economic growth, and automated productivity is not growing fast enough to bridge this gap.
Earlier this month, the U.S. Census Bureau estimated that the U.S. population grew at 0.1 percent in 2021, the lowest level on record. Other recently released census data shows that immigrants — long a major source of new workers — fell to their lowest levels in decades in 2021.
Marianne Wanamaker, a professor of economics at the University of Tennessee and one of the trump administration's top White House economists, said, "If labor force participation rates don't change and immigrants don't recover, then we can't continue to grow at the rate we were supposed to." The level of automation in our country is not enough to keep us on track for economic growth. ”
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