The covid
recession or whatever you want to call it caused the sharpest drop in
employment ever but thanks to the stimulus checks during the lockdowns and soon
after gave us the quickest rebound again ever recorded. I for one am not at all
unhappy that wages are rising rapidly and that companies have to pay up for
labor. It’s about time it happened because wages have been depressed too long.
Inflation has increased with it but that only underlines that demand for labor
is very strong. Paradoxically company profit have surged to new levels so
although they complain they are not doing to shabbily at all.
Maybe
higher wages feeding into higher volumes and prices are creating a virtuous
circle. We could say it is all due to government borrowing and that could be
true. Nevertheless priming the pump sometimes is not only the best way to go
but the only way to start the motor. Finding the sweet spot between good wage
growth, inflation and corporate profits is really not an easy thing to do but
it does leave us with lots of opportunity to criticize government policies and
the individuals attached to them. The U-6 at 7.8% is not great but not
too long ago it was above 10% so it is getting better and hopefully get better
still. I wonder if we had decided to attack the Great Recession of 2008 by
opening the money vanes then as we have now would the result would have been a
sharp recovery growth and wages? Instead we kept spending too low depending on
low interest rates to do the job. The result was anaemic growth with a high
deficit anyway, probably the worst combination, leading to widespread justified
social unrest. The only people not screwed were those on the high end.
But things
are changing irrespective of who is in office. I believe that we,
meaning the developed world and parts of the rest are barreling toward full
employment coupled with social unrest. It’s an unstable and very uncomfortable
situation but creative environments rarely are. I noticed that the markets are roaring,
labor is rare, wages are rising, company profits are great. When you ride the
tiger you have to hold on tight. We really do live in interesting times.
thimk
2 years ago
3 million plus fence sitters , still fat and happy – we are still not fully recovered to precovid levels . chart of u6 employment history .
A 72 year old hvac installer called me again to help him with an install( I’m 68 years old with little hvac experience) . I had to decline this time , my bones are too creaky .
KidHorn
2 years ago
Apparently the BLS had a huge downward adjustment this month. More than makes sense. They will likely revise the 210k number much higher next month.
Seems ending benefits has pushed many back into the work force. A very good thing IMO.
Eddie_T
2 years ago
We are trying to make a hire…..but there are NO good candidates applying, Worst I’ve seen in over 30 years, in my business.
You need to keep upping the wage until you find someone, but be really careful not to offer too much or else your current employees will get upset and might quit. Taken from personnel experience.
They must have gone somewhere but where? You are in the health industry. Could it be the vaccination requirement pushing people out of the industry or perhaps going to employers who don’t require it either there or in another state?
In my view we are seeing the lesser-skilled cohort of healthcare workers abandon the entire field…..out of both a fear of COVID (#1) and also the fear of vaccination (#2).
People like medical and dental assistants, and home health and nursing home workers (none of whom have ever been highly paid or well-educated) have now realized that those jobs carry a lot more risk than they ever considered in the old days. That has completely changed the calculus in their decision of WHAT kind of Job they desire.
These people have no clue as to what the risks are as far as getting vaccinated or not getting vaccinated. They are easy prey for the psychopaths trying to argue against vaccination, because they get their information from FB or their family members. (That term psychopath is one I’m borrowing from Nassim Taleb, who daily takes the time to debunk the anti-vax bs. More power to him.)
Our pool of applicants is now maybe 10% of what we had pre-COVID.
We are seeing the same thing in France. Most people aren’t Florence Nightingales by nature. In 1918 they would go door to door looking for anyone who had worked in a hospital and draft them. The draft law was in effect and if you refused you went, man or woman, right away to jail.
We have a low-level admin position that keeps turning over within a few months because they find higher paying jobs. In our case it is 100% wage level being too low to keep someone, not worth paying over market for a simple job. So we are permanently training the revolving door desk. Half the candidates never show to the interview, if not 3/4. Not saying you’re wrong and don’t know what level the position you speak of is at, but there are lots of positions that are churning madly due to a mismatch between what employer and employee think a position is worth.
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The covid
recession or whatever you want to call it caused the sharpest drop in
employment ever but thanks to the stimulus checks during the lockdowns and soon
after gave us the quickest rebound again ever recorded. I for one am not at all
unhappy that wages are rising rapidly and that companies have to pay up for
labor. It’s about time it happened because wages have been depressed too long.
Inflation has increased with it but that only underlines that demand for labor
is very strong. Paradoxically company profit have surged to new levels so
although they complain they are not doing to shabbily at all.
Corporate
profits:
link to tradingeconomics.com
Maybe
higher wages feeding into higher volumes and prices are creating a virtuous
circle. We could say it is all due to government borrowing and that could be
true. Nevertheless priming the pump sometimes is not only the best way to go
but the only way to start the motor. Finding the sweet spot between good wage
growth, inflation and corporate profits is really not an easy thing to do but
it does leave us with lots of opportunity to criticize government policies and
the individuals attached to them. The U-6 at 7.8% is not great but not
too long ago it was above 10% so it is getting better and hopefully get better
still. I wonder if we had decided to attack the Great Recession of 2008 by
opening the money vanes then as we have now would the result would have been a
sharp recovery growth and wages? Instead we kept spending too low depending on
low interest rates to do the job. The result was anaemic growth with a high
deficit anyway, probably the worst combination, leading to widespread justified
social unrest. The only people not screwed were those on the high end.
But things
are changing irrespective of who is in office. I believe that we,
meaning the developed world and parts of the rest are barreling toward full
employment coupled with social unrest. It’s an unstable and very uncomfortable
situation but creative environments rarely are. I noticed that the markets are roaring,
labor is rare, wages are rising, company profits are great. When you ride the
tiger you have to hold on tight. We really do live in interesting times.