Opinion: Trump Economy; More Winning
Total Employment
As I’ve noted in more than a few articles, President Trump is proving the master at 3-D chess and the art of achieving synergies among multiple lines of operation. In one such article, I noted that The President was able to leverage successes with our trade Mexico into successes with China in the trade arena. He has also managed to achieve synergies in the American job market.
On Monday’s David Webb** show Webb had on as a guest, Marc Lotter, the Director of Strategic Communications for the Donald Trump 2020 Presidential Campaign. It was a pretty wide ranging discussion, but one point got my attention. It had to do with the current employment situation. Mr. Lotter, in his effusive praise of the Trump recovery and our currently roaring economy, pointed out something interesting.
He first spoke to the current employment numbers…which as I show below, are phenomenal. We are actually above statistically full employment, 3.6%! Moreover, our Labor Force Participation Rate has actually increased, by .2 percent bringing us to 63.4 percent. Before I get to Mr. Lotter’s pertinent comment, here are extracts from the Bureau of Labor Statistics Monthly report Dated Feb 7, 2019 for the month ending January 2019. Bolded items are my emphasis.
You can read the whole thing here.
Among the unemployed, the number of reentrants to the labor force increased by 183,000 in January to 1.8 million but was little changed over the year. (Reentrants are persons who previously worked but were not in the labor force prior to beginning their job search.)
After accounting for the annual adjustments to the population controls, the civilian labor force rose by 574,000 in January, and the labor force participation rate edged up by 0.2 percentage point to 63.4 percent.
In January, average hourly earnings for all employees on private nonfarm payrolls rose by 7 cents to $28.44. Over the past 12 months, average hourly earnings have increased by 3.1 percent. Average hourly earnings of private-sector production and nonsupervisory employees were $23.87 in January, little changed over the month (+3 cents). (See tables B-3 and B-8.)
The change in total nonfarm payroll employment for November was revised up by 5,000 from +256,000 to +261,000, and the change for December was revised up by 2,000 from +145,000 to +147,000. With these revisions, employment gains in November and December combined were 7,000 higher than previously reported.
To recap, we have an unemployment rate that is holding steadily at 3.6%, which is above statistically full employment—this, as we have over a half million people reentering the labor force in one month.
Wages are rising in the private, non-farm sector and are now averaging $28.44/hour. More on this later.
Best of all, instead of publishing favorable estimates and then revising them down later, as the Obama Administration was wont to do, November and December estimates were revised up for a combined total of 7,000 jobs.
Mr Lotter noted that one result of the booming Trump economy is a shortage of qualified labor. He noted that there are now more open jobs than there are people available to fill them. He also pointed to the low unemployment number, combined with steadily increasing wages and assessed that employers are now having to go the extra mile to recruit employees.
Here is the exciting part. President Trump’s economy has encouraged employers to reverse a bad trend in our economy. Employers are now bringing on board new people who might not have all the required skill sets. Labor is now so valuable, that employers are much more willing to incur the expense of training new employees. This is huge. It has now become an “employee’s market.”
Of course, particular insight came from President Trump’s head campaign communications guy. So, I had to do a little due diligence. Here is what I’ve found.
Lotter is right and this trend has been going on since at least last year.
In an August, 2019 article, CNBC, certainly no Trump fan club writes;
Job seekers have the upper hand in today’s labor market — so much so that employers are beginning to be more flexible in order to bring on new talent.
“To compete in today’s tight labor market, employers across industries are becoming more flexible with their job requirements,” said Amy Glaser, senior vice president of Adecco USA, in a release. “In many cases employers are bringing in talent that may not have all the skills needed and then upskilling or training candidates to complete job-specific tasks.”
Read: More than 60% of employers are now willing to hire applicants with less than the required work experience
One article doesn’t constitute a trend so I looked over at Career Builder a job search site, and found a March 2019 piece.
we’ve found that 59 percent of employers plan to train and hire workers who may not be 100 percent qualified but have potential,” said Irina Novoselsky, CEO of CareerBuilder.
Read: Forty Percent of Employers Plan to Hire Full-Time Workers This Year, Forty-Seven Percent Recruiting Part-Time Workers
Another side benefit to this, is for minority candidates who might have heretofore been overlooked due to lack of the proper skill sets. Companies that have made the decision to hire less than optimally skilled workers now have no excuse to not give minority candidates a closer look.
Success begets success. Given the speed and degree to which all this is coming together, I’d be surprised if The President didn’t announce that we have a vaccine for the Corona Virus and distribution begins iN 7 days.
Here are some pieces on Trump Trade Policy that relate to this article.
Read: A Different Aspect of Tariffs
Read: The First Pinholes in the Dike
Read: Another Pinhole in the Dike
David Webb can be found M-F from 9:00 AM ‘til Noon on Sirius 125.