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The U.S. Job Market is Gaining Traction
By EconMatters
Claims Data
The Jobless claims data came out on Thursday and the trend is still in place and bodes well for the May Employment Report coming out next Friday as jobless claims fell sharply in the May 24 week, down 27,000 to 300,000. The 4-week average is down a significant 11,250 to a new recovery low of 311,500. Continuing claims are also down, falling 17,000 in data for the May 17 week to a new recovery low of 2.631 million. The 4-week average is down 33,000 to 2.655 million, also a recovery low. The unemployment rate for insured workers, also at a recovery low, came in at 2.0 percent. Notice a pattern here, new recovery low, new recovery low, and new recovery low.
Headhunters Buzzing Right Now
I can tell the job market is really on fire through a couple of the measures I interact with in my daily life which shows a couple of things, first that wages are going up, and second that headhunters are really calling a bunch of my colleagues in Corporate America with multiple job opportunities.
But it is just not corporate jobs as the businesses in my area post job openings along with wage info on their billboards when they really need people, like cashiers, installers, and Car Wash Sales positions and going by the rise in wages posted on these billboards the job market is tightening for workers at this level as well.
Albeit we reside in an area that outperforms the overall economy, and in some cases economies are subject to local pressures, but this area has always outperformed, and the level of increased activity is quite noticeable, which means business is picking up relative to previous levels.
Strong Employment Report
We expect a strong Employment report next week for another new recovery record for consecutive months of jobs added at these levels of 200k plus, and we expect the unemployment rate to drop below 6% sooner than most believe at this pace.
I know the doom and gloom crowd will focus on those who have left the workforce, and sure that is an area for improvement, but it starts by employing as many people who are in the workforce first, and then as conditions tighten further in the job market, enticing people to work and come back into the job market. This is related to a tightening job market where employers lower some of their standards and wages rise, both of which we anticipate coming down the pike over the next six months as the job market continues to strengthen.
Wage Pressures & Inflation
But from an inflation standpoint if those workers never come back to the workforce for various reasons, the pool of talent available who are looking for a job is fought over by employers needing to fill positions, and in some cases attracting workers to switch jobs or companies, we also have seen an uptick in this area in the Corporate world.
Consequently what really matters for jobs is the pool who are in the market looking for work, and if this is shrinking that is bullish for workers’ opportunities and salaries, bad for inflation and companies needing to fill those positions, but overall leads to a tightening job market where the Fed will need to start normalizing interest rates to avoid runaway inflation.
Elevated inflation would be fueled by wages rising substantially all along the wage continuum for the first time in the post recovery world, and the inflation numbers start trending well above the Fed`s target, we anticipate this occurring once these wage pressures start showing up in the data set.
Read More: U.S. Structural Jobs Paradigm
Labor Starting to Gain Negotiating Power
Tightening in the job market carries over to all types of positions, if an employer who used to get away with hiring contract workers to lower costs, now has to change these positions to full-time hires and raise the salaries to attract the talent they need to complete projects, contract salaries end up going higher as well.
This is the area we haven`t seen a significant spike since the recession, and we feel the entire market and employers are behind the curve on and have become too complacent with the status quo. Employers and HR are in for a real shock when they need to start refining their budgets and raising wages to fill positions, they are used to always negotiating from a position of strength, we see the tables turning in this area as the labor market continues to tighten.
The Employment Trend is Bullish
Despite all the doom and gloom in the market, we would have loved to have these employment numbers three years ago, jobs and the economy are trending higher, and better times are ahead for those looking for work, and those not looking for work, don`t be surprised if you find your services in demand once again, as companies reach out of their comfort zone to fill positions.
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It's only gaining traction for the already-employed/short-termers. Those that are in the long-term category would have to have an act of legislation happen to get them in.
somehow the Kim Kardashian bikini shot goes really well with this article.
Not at all what I am seeing on any front, especially in programming. Perhaps he doesn't understand that a "job" in these bogus statistics is 1 hour per week at minimum wage.
nutz
Unemployment Over 20% in Some Cities
http://247wallst.com/economy/2014/05/29/unemployment-over-20-in-some-cit...Beaumont ISD May Cut 300 Jobs:
What region of ganja are these douche-monkeys smoking?
Jamaican morass?
Hill weed?
Maui Wowie
Hydro
or are they smoking turds from a close by Monsanto farm?
This econmatters chump should stick to writing for Business Insider or Seeking Alpha.
Yes,, I am going to renegotiate my rates to 200$/hr!!!!
Thought this was Friday Humour.
Then I realised it's only Thursday.
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Oh, and EconMatters, go fuck yourself you bunch of fucking morons!
Any quality jobs besides the cashiers, installers, and Car Wash Sales positions? lol. Didn't think so.
Did ZH buy the Onion or something?!
No, CNBC bought Zero Hedge. According to the press release, this will increase CNBC shit site readership 100 fold.
One month's QE could pay for 300K $50K jobs for 5 years. This jackass is cheering on 200K jobs. That's some funny shit.
Bankster jobs are more important than citizens jobs.....
That whole Animal Farm thingie...
Let's face it as the key is when everyone, everywhere goes bullish/positive (which we're fast approaching). I believe just about every economist is projecting 3+% economic growth (but don't worry about the ACA tax effect as healthcare will drive GDP). We have the VIX at a low last seen in 2007. Stocks making highs everyday as well as credit. Energy independence is just around the corner with fracking (Not! just check the production rates past year one on the wells). Consumer confidence at multi-year highs (of course compared to what as all benchmarks are from 2007 through 2009 when everyone was in the shitter). Consumers have deleveraged (was debt really paid off or simply written off or better yet, consumers focused to be renters now and don't report mortgages as debt as the homes are now owned by Wall Street). Job growth of 200k per month which may seem like alot but its quality and fact that it is basically just keeping up with population growth are often not mentioned. And the list goes on and on. Even the naysayers focused on the coming market correction are jumping on the band wagon and keep pushing off the market correction.
There are a few voices of reason but they are being drowned out, by the politicians and their MSM bitches that keep fueling the miracle of the US economy that is just around the corner (what we've been hearing for the past 3+ years). And this is exactly what ever contrarian should be looking for and remember what it took to reach this point of economic activity - $7 trillion plus of stimulus (between the Fed and Washington) and historical low interest rates that by most measures are negative right now.
And this is my primary point. When everyone moves to the same side of the ship and then has to scramble back, the rocking will be violent. It reminds me of the old trick played on cruise ship passengers when an announcement is made about whales being on one side of the ship. Everyone runs and then realizes they've been duped. This is the role MSM is playing these days as they are getting everyone to run to the same side of the ship and you know what, its working and not all with lies but rather mis-information and lack of depth with perspective. Honestly, I don't doubt that employment levels are increasing (as for the qualify of the jobs, that's another issue) and the economy has some room to grow through 2014, 2015, and 2016. But if history has taught us anything, here is what I do know:
- Each economic correction is more violent and extreme than the last (since the Great Depression). So the next correction will most likely be extremely violent and require even more stimulus (from where, I don't know) than the last.
- The current economic cylce is roughly running 7 to 8 years so 2014/2015 are going to be important years to watch for cracks to start to appear. Anyone who believes that the US will have perpetual bliss on the economic front is either from Washington (feeding MSM) or Colorado (hitten the MJ).
- The last person at the party to get the message that problems are present is usually the stock market. Use to be a leading indicator but now it is nothing more than legalized gambling.
- The change in Fed policy (i.e., tapering) usually takes approximately 9 to 12 months to be fully realized. Since it started in late 2013, I would look for the full effect of the impact to start to be realized in Q4 2014. If you look back at similar Fed policy changes (almost exclusively with interest rate changes), this has been the general trend.
- I can't recall ever seeing global CB's intervene in the world economy to this extent by injecting $10+ trillion of cash and decreasing interest rates to historical lows. If I'm wrong please correct me but what we are witnessing is a global economy in uncharted water, never before seen strategies, used to keep the world's economy afloat. So how can anyone even begin to predict how this is going to turn-out? A bunch of economist that seem to only focus on outdated charts, graphs, and measurements to gage where the economy is headed?
- More than likely, the eventual black swan or events that drive the next economic correction will come out of left field, basically unknown to most people, even the best and brightest minds. Too many people are focused on too easy targets right now to identify the next event (e.g., techs and new tech IPOs are extremely overvalued). You must really test your mind to identify the event(s) that are really going to be the catalysts for the next monster move.
This is one of the reasons why so many parties have been incorrect on just about everything with the current economy. How can interest rates being going down at this stage of the recovery? Why hasn't the economy grown faster? Stocks are completely overvalued but hit new highs each day. There are so many counter-intuitive trends occuring on a frequent basis that even some of the best minds are becoming confused. And the reason is simple - The Worlds CBs have embarked on easing strategies that have never been witnessed with the ultimate outcome completely unknown (at this stage).
So for me, its the trend my friend as I'm watching and hoping for everyone to jump on the band wagon and become convinced that all is well and that all of the problems experienced by the US economy during the Great Recession have somehow been fixed/solved. When this euphoria reaches a new high both in actual level measurements and breadth/participation, then its game up. Don't believe where there yet and may have another 12 to 24 months to go but when it does happen, it will happen at a speed that catches literally everyone off guard (expect those that manufactured it).
Hey EconMatters.....go FUCK YOURSELF and your two-bit "analysis."
Oh, for fuck's sake x2.
Sure, I notice a pattern. It's a pattern of reliance on bogus statistics, propaganda, and incorrect definitions in this article. I especially loved this little gem: "Elevated inflation would be fueled by wages rising substantially all along the wage continuum..." Duuuude, don't bogart that hopium.
very amuzing; now where's the real article?
Oh for fucks sake....
" Continuing claims are also down, falling 17,000 in data for the May..."
They're rolling off the end of the extended benefits...
And now for a lighter moment---" Traction. LOL>it's gaining Traction; it's just not gaining jobs. "Hey, Ralph pretty soon now we'll be up to Traction level one"---"Cool, way to go, ma man".
"I don't care whose nephew you are, who you know, whose dick you're suckin' on, you're goin'' - Ricky Roma
This article is filed under pay to play right?
EconMatters is talking 100% bullshit straight from Gang Obozo! So is this what Reggie Love and Cal Penn are doing these days?
www.TruthDecals.com
I'd like to believe this, I really would, but I don't.
If you have been out of work for more than a year or so they stop counting you.
Labor force participation rate is what you need to pay attention to, not a microcosm such as New York or D.C.
I guess ZH had to allow this "postive" article (with cherry-picked not-too-bad shot-term data, ignoring the mega-trend) for balance.