US econ­omy closes jobs gap with strong July pay­rolls

Muscat Daily - - BUSINESS -

Washing­ton, US - Eight years af­ter the end of the last re­ces­sion, the US econ­omy has by an­other mea­sure re­turned to em­ploy­ment lev­els from be­fore the down­turn.

The bet­ter-than-es­ti­mated 209,000 pay­roll gain in July was more than enough to close what the Hamil­ton Project calls the ‘jobs gap’. The mea­sure, which ad­justs for growth and ag­ing of the pop­u­la­tion, ac­counts for to­tal em­ploy­ment and what’s needed to ab­sorb the num­ber of new labour-mar­ket en­trants, ac­cord­ing to the eco­nom­ics off­shoot Brook­ings In­sti­tu­tion.

“It’s sort of a mark of heal­ing of the labour mar­ket,” said Diane Whitmore Schanzen­bach, the out­go­ing di­rec­tor of the Hamil­ton Project. “That doesn’t mean we’re at full em­ploy­ment or any­thing like that, and I think ev­ery­body’s wor­ried about wage of the growth, but this is one marker of heal­ing.”

The Hamil­ton Project’s mea­sure is an at­tempt to parse how much the labour mar­ket has im­proved cycli­cally.

While it took eight years for the jobs gap to close in this ex­pan­sion, it never did in the pre­vi­ous one that be­gan in 2001. Be­cause the em­ploy­mentto-pop­u­la­tion ra­tio was turn­ing lower be­fore the last re­ces­sion that started in De­cem­ber 2007, there was a lower hur­dle to clear this time around, the project’s au­thors wrote. With the July pay­rolls gain, em­ploy­ment in 2017 has av­er­aged 184,000, in line with 187,000 last year. At the same time, wage growth has re­mained slug­gish, ris­ing at a 2.5 per cent year-on-year rate in July that matches the av­er­age of the past two years.

With the July pay­rolls gain, US em­ploy­ment in 2017 has av­er­aged 184,000, in line with 187,000 last year

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