Sunday, October 24, 2021

US adds 559,000 jobs as businesses still struggling to fill jobs

WASHINGTON – U.S. employers added a modest 559,000 jobs in May, an improvement from sluggish profits in April, but still proving that many businesses are struggling to find enough workers as the economy recovers from the pandemic recession.

Last month’s labor growth was above April’s revised total of 278,000, the Labor Department said on Friday, but still far less than the need for employers. The unemployment rate dropped from 6.1 percent to 5.8 percent.

Many large chains, including Amazon, Walmart, Costco and Chipotle, have increased the initial payment to better attract applicants. So too with other employers: Wages jumped for a second consecutive month in May, a sign of companies wanting to attract more workers. And the average workweek has remained high, indicating that businesses are working longer with their current staff to meet the growing demand from customers.

Still, the number of people working or looking for work last month slipped slightly in May after three months of profit.

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People stand outside a newly reopened personal dating center in Louisville on April 15, 2021. (Amira Karaoud / Reuters)

Most of the job growth last month was at hotels, restaurants and pubs, which gained 220,000 jobs. Retailers lost jobs for a second consecutive month. And despite a hot housing market, the construction industry shrugged off 20,000 jobs, the second month of the cut, which likely reflects the shortage of supply and rising costs for building materials.

The economy expanded last quarter at a robust 6.4 percent annual rate, and economists predict that growth in the current quarter will reach a rapid pace of 9 percent or more. All the growth, driven by higher spending, gave rise to inflation fears. But for now, it has driven the demand for labor primarily.

According to job website Indeed, job appointments at the end of May were nearly 26 percent higher than pre-pandemic levels. Government data shows that posted jobs are at the highest level in records dating back to 2000.

And consumers are opening their wallets. In April, they increased their spending after a huge profit in March fueled by the distribution of $ 1,400 stimulus checks. As more Americans felt comfortable staying in hotels and visiting entertainment venues, spending on services increased rapidly.

Service industries, including banking, retail and shipping, expanded at the fastest pace in May. The evidence suggests that consumers began a long-awaited shift from the substantial purchases of goods that many of them made while sitting at home after spending services, from haircuts to sporting events to holiday trips.

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rental sign
rental sign
An ad now being rented appears on April 29, 2021 at the back of fuel trucks in Richmond, California. (Justin Sullivan / Getty Images)

The number of people seeking unemployment assistance has fallen to its lowest level since the pandemic for five consecutive weeks, a sign that redundancies are declining. There are still 15 million people receiving federal or stateless assistance, although the number also declined from about 20 million in February.

While businesses want to add workers right away, many unemployed are looking for or have better jobs than they had before the pandemic, they still have affordable childcare, they are worried about contracting COVID-19 or have decided to retire early.

This mismatch led to the sharp slowdown in appointments in April, when employers added far fewer jobs than economists had predicted and far fewer than those appointed in March.

The economy still has 7.6 million fewer jobs than before the pandemic.

Many businesses blame a federal unemployment benefit of $ 300 a week for discouraging some of the unemployed from taking jobs. Republican governors in 25 states have responded by cutting off this benefit prematurely, starting this month before the benefits end nationally on September 6th.

Epoch Times Photo
Epoch Times Photo
People stand in front of the opening outside Kentucky Career Center to get help with their unemployment claims in Frankfort, Ky., On June 18, 2020. (Bryan Woolston / Reuters)

Becky Frankiewicz, president of the North American division of the temporary staffing firm Manpower Group, said many of the firm’s customers are raising salaries and benefits to try to attract more applicants. Some of these businesses, especially in manufacturing and warehouses, are also trying other tactics, such as paying their workers weekly or even daily, rather than every two weeks. Manpower also encourages its customers to offer job offers the same day as an interview rather than waiting.

About 60 percent of Manpower’s temporary placements leave their jobs before a temporary assignment ends, Frankiewicz said, mostly because they receive better deals.

“People have options,” she said. “Companies need to offer speed in cash, speed hire and a lot of flexibility in their work.”

For now, however, there are signs that many unemployed people remain cautious about looking for work.

Tony Sarsam, CEO of SpartanNash, a grocery distributor and retailer, said in a telephone conversation with investors on Thursday that the company participated in a job fair last month with 60 companies having to fill 500 jobs.

“Only four candidates showed up,” Sarsam said.

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