Conference Board commentary on national labor market for 2020

January 10, 2020

Despite gradual slowing of job growth, labor market will still feel tight in 2020

Comment on U.S. Bureau of Labor Statistics Employment Situation Report
Frank Steemers, Associate Economist, The Conference Board

The US economy added 145,000 jobs in December, and previous months were revised down slightly. The unemployment rate remained at 3.5 percent. This month’s job growth was in line with The Conference Board’s view that the labor market appears to be in a healthy state.

Job creation was mainly concentrated in the services sector as well as in construction, while the decline of 12,000 jobs in manufacturing shows that this part of the economy is still weak. However, easing trade tensions between China and the US may help to further improve business confidence in 2020, as The Conference Board reported earlier this week.

With this month’s increase in employment, the labor market ended 2019 on solid footing. In 2019, the unemployment rate reached its lowest point since the late 1960s and job growth was strong with an average of 176,000 jobs added per month – just over 20 percent slower than the average of 223,000 in 2018. The labor market performance in 2019 should therefore be considered a significant achievement after an economic expansion of over 10 years.

While employment growth will somewhat moderate in 2020, the labor market will likely continue to further tighten as the working-age population is barely growing and labor force participation rates are only slowly increasing. Employers hiring blue-collar and manual services workers will have a harder time recruiting and retaining current employees. For these workers we also see strong wage acceleration, much faster than growth in the average hourly earnings which stagnated in 2019 at around 3.2 percent, and weakened this month to 2.9 percent. Slower wage growth for highly educated management and professional workers has held back average wage growth for all workers.

About The Conference Board
The Conference Board is the member-driven think tank that delivers trusted insights for what’s ahead. Founded in 1916, we are a non-partisan, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States. http://www.conference-board.org.

About TARR Report

S.M.A. Publications was formed in 1997 with a mission of providing real estate information for practitioners within the Research Triangle Park area of North Carolina. The company produces the T.A.R.R. Reports which are published monthly, quarterly and annually, covering all aspects of the residential real estate market. The publisher, Stacey P. Anfindsen, has over 23 years of residential experience in the Triangle market. He is an active real estate appraiser, educator and consultant.
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