Jobs Friday...On Monday : Planet Money The monthly pace of jobs growth has slowed this year. But that's not necessarily a problem.
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Jobs Friday...On Monday

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Jobs Friday...On Monday

Jobs Friday...On Monday

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CARDIFF GARCIA, HOST:

Hey, everybody. It's Cardiff. And this is THE INDICATOR FROM PLANET MONEY. Today is jobs Monday. That's right. We delayed the jobs report show by a weekend because the rest of THE INDICATOR crew wanted last Friday off. And they said, hey, it's OK to skip a jobs Friday. I wasn't standing for it. OK. We weren't going to skip it for a whole month. We were just going to delay it for a bit.

So I actually came in on Friday. That's right. I came in on Friday. I was joined by our old friend Martha Gimbel, the economic research director at the Indeed Hiring Lab. And we got to work putting together this jobs Monday episode.

So ha-ha, I win because I was working on Friday, whereas the rest of THE INDICATOR crew was, I don't know, spending time with their friends and family and loved ones and hanging out by the beach. Whatever. It's a jobs Monday episode. And here, as always, is the air horn.

(SOUNDBITE OF AIR HORN)

GARCIA: All right, everybody, we've got Martha Gimbel in the house - or in the studio, at least. She is the economic research director for the Indeed Hiring Lab. Martha, welcome back.

MARTHA GIMBEL: Thanks for having me.

GARCIA: All right. So we had a jobs report that dropped today, OK - 224,000 jobs created in the month of June. Why don't you put this into a bit of context for us? What does that mean for the U.S. labor market?

GIMBEL: So for the last few months, there's been a little bit of back-and-forth about whether or not the labor market is not just slowing down, but slowing down enough that we all need to start panicking. And this month, the jobs numbers send a pretty clear message of, hey, we're slowing down. We're going to go back to normal jobs growth numbers after a gangbusters 2018. But it's probably not going to be anything scary. We're going to be hanging out, creating around 150,000, 170,000 a month, and that's OK.

GARCIA: That's a pretty good number, you think, for this economy - 150,000, 160,000, 170,000 jobs a month is OK?

GIMBEL: Think of how far we are into this recovery, the fact that we're still creating that many jobs a month...

GARCIA: Ten years in.

GIMBEL: Right, exactly - is incredibly exciting.

GARCIA: Let me drop a quick number here for you. So last year, 2018, the U.S. economy was creating on average 223,000 jobs a month. So far this year, including those June numbers, the U.S. economy is creating 172,000 jobs a month. And what you're saying is that, yeah, that's a big drop off. But you know what? You would expect that because at some point, the economy gets to the point where, like, there just aren't that many more people to hire into jobs. And we might be approaching that point.

GIMBEL: Yeah. And if you go back and look at the average number of jobs that we created at this point in the year in 2016 and 2017, it looked a lot like 2019 has looked. 2018 was an anomalous year. The government was pouring a lot of money into the economy. And so we had a lot of job growth. We're probably just not going to keep seeing that high number moving forward, and that's OK.

GARCIA: And that's OK. OK. Here's one other data point that we learned in the jobs report. Wage growth has climbed by 3.1% in the past year. That is not much of an improvement on where wage growth was, like, six months ago or a year ago. What do you think about that number?

GIMBEL: I think the wage growth number is frustrating. We obviously have been hoping to see continued acceleration in wage growth. I'll also note that that leveling off in the wage growth number has held against low-wage industries, middle-wage industries, high-wage industries. It's really happening across the board.

That being said, clearly employers are continuing to be able to hire. And so until employers aren't able to hire the people that they need at current wage growth levels, they're not going to start picking up wage growth.

GARCIA: This one, though, is a lot more annoying to me because I had hoped that as the economy got better and the labor market got stronger, that we would reach that point where companies were competing more and more with each other and would have to offer people more raises to keep their workers or to attract new workers. And it seems like that number - that wage growth figure - has just been kind of stagnant recently.

GIMBEL: So one thing to keep in mind is that wage growth usually is responsive to quits. So...

GARCIA: People quitting their jobs.

GIMBEL: People quitting their jobs. So employers will raise wages if they're afraid that they're going to lose workers to other employers. And the quits rate has been holding steady. So we might not see wage growth accelerating again until people start quitting their jobs and looking for their next new thing.

GARCIA: So that's another thing to watch for then is people quitting their jobs. If that happens in higher numbers, then that's a sign that maybe wage growth will start to accelerate.

GIMBEL: Exactly.

GARCIA: OK. Anything else in this jobs report that stood out to you?

GIMBEL: One thing to keep in mind through all of this is we still have a lot of people in this country who have been out of work for six months or more. So we have 1.4 million people in the United States who have been out of work for 27 weeks or over.

GARCIA: The long-term unemployed.

GIMBEL: The long-term unemployed. So about 24% of the unemployed count as long-term unemployed. And so those are some people who are still not really benefiting from a tight labor market and may need some extra help.

GARCIA: OK. Well, there's one other thing that I asked you to look into before our chat today because it's summertime. People are on break. Literally the whole INDICATOR team but me - I'm just going to drop that last guilt trip in there - is off today. Vacation trends - can you tell us a little bit about vacation trends in the U.S. labor market?

GIMBEL: Well, if it makes you feel any better, almost everyone else on my team is also on vacation today.

GARCIA: (Laughter) Just you and me holding down economics commentariat.

GIMBEL: It's the only ones. So if you look at paid vacation in the United States, the Bureau of Labor Statistics releases a survey once a year called National Compensation Survey. They look at employee benefits.

GARCIA: The NCS.

GIMBEL: The NCS.

GARCIA: This is your favorite.

GIMBEL: I love the NCS.

GARCIA: Yeah, this is your favorite.

GIMBEL: I do. I think people don't pay enough attention to this. I think it's really cool. And so you can look at the percent of Americans who have access to paid vacation at work. And in 2018, it was 77% of private sector workers. If you looked at 2010, it was about the same percent.

GARCIA: So that hasn't improved at all - really?

GIMBEL: It hasn't improved at all. And my hypothesis as to why this is happening, I think, shows an interesting dichotomy in our labor market. So if you look at two other types of benefits in the United States - access to paid sick leave and access to paid family leave - those have improved since 2010.

And part of what you're seeing is, for workers who are paid really high wages - so that top, say, 10% of workers - they already have access to paid sick leave. They already have access to paid vacation. What they haven't had access to is paid family leave. And that's what we've seen them really getting more of is increased access to paid family leave.

On the other hand, if you look at the lowest-paid workers, they don't even really have full access to paid sick leave. So, for instance, in the leisure and hospitality industry, only about 40% of workers have access to paid sick leave. And so what you're seeing is that those really high-paid workers are bargaining for more access to paid family leave, the really low-paid workers are bargaining for access to paid sick leave. And no one's focused on vacation time right now.

GARCIA: I got to say, this is a little bit disappointing also because 10 years after the recovery started from the last recession, we've seen improvements in some parts of the labor market. Wage growth is at least a little better than it was a few years ago.

You know, we're starting to see wage growth even in some of the low-paid sectors. This has been a focus of your work. And yet we're not seeing the quality of some of these jobs improve maybe as much as we'd like. And I think vacation time is at least one indicator of that.

GIMBEL: Right. It also speaks to the way that, frankly, the United States is behind some other developed countries. So in, you know, a lot of other countries, workers don't need to bargain for access to paid family leave because the government mandates that they have access to paid family leave.

Paid sick leave, paid time off - these are things that other countries often regulate at the national level. And so since workers in the United States were starting off a little bit behind, they have to bargain for, frankly, some basic benefits like paid sick leave and paid family leave before they get to the fun ones like paid vacation.

GARCIA: Martha Gimbel, what are you doing for vacation this summer?

GIMBEL: So I am going to Stratford-upon-Avon.

GARCIA: Oh, great.

GIMBEL: ...To visit the birthplace of William Shakespeare.

GARCIA: Of Shakespeare, yeah. You going to catch a play while you're there?

GIMBEL: We're going to go see a gender-flipped "Taming Of The Shrew."

GARCIA: Outstanding.

GIMBEL: Yeah. It's going to be great.

GARCIA: Well, have fun. Make sure you separate from the workplace vacation - super important, everybody, says the two people who are working on the Friday after the Fourth of July. Martha, thanks very much.

GIMBEL: Thanks for having me.

GARCIA: This podcast was produced by Constanza Gallardo, edited by Paddy Hirsch and fact-checked by Emily Lang. THE INDICATOR is a production of NPR.

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