Chart of Day: An Extremely Rare Jobs NumberOctober 8, 2018
We haven’t seen unemployment numbers this good in almost 40 years.
In fact, the rate fell to 3.7%, the lowest since December 1969, as employers added another 134,000 jobs to payrolls. Granted, that number was below expectations and the monthly average for the year, but it was enough to send the overall percentage lower.
“Unemployment is the lowest number since 1969,”tweeted President Trump
The only reason we saw a month over month downturn was because of Hurricane Florence.
According to the Bureau of Labor Statistics, 299,000 people were not at work because of weather issues. Nearly 1,500 people, who normally work full-time, could only work part-time, as well. More than likely, we will see the September numbers revised higher, the Bureau added.
In addition, the prior two months were revised upward by a combined 87,000 jobs, which boosted the monthly average for the year to 211,400.
Wages were up 2.8% year over year, as well.
“This is the best job market in a generation or more,”said Andrew Chamberlain, chief economist at Glassdoor, as quoted by The Wall Street Journal.
What makes the jobs number so exciting is how rare it is to see one below 4%.
According to The Wall Street Journal:
“Unemployment rates below 4% are extremely rare in 70 years of modern record-keeping. The two longest sustained periods came during the Korean and Vietnam Wars, when the combination of strong growth and the enlistment of young men from the civilian labor force helped to largely wring unemployment out of the economy.”
Better still, the Federal Reserve believes the current unemployment rate is sustainable. They’re even projecting the rate to plunge to 3.5% by 2019, and stay under 4% through 2021.
On top of that, inflation will remain calm, allowing them to keep short-term interest rates low. Fed Chairman Jerome Powell says he sees no real reason to boost the pace of interest-rate increases, in part because inflation is low and stable.
In short, the U.S. economy is humming along just fine.
U.S. GDP is on track for 2.9% for 2018. Consumers and businesses are the most confident they’ve been in years. The stock market is hitting new highs.
The record low jobs numbers prove that we’re out of the woods and moving in the right direction.
While wage growth for September was weaker month over month, we still saw monthly and annual earnings climb by 0.3% and 2.8% respectively. Both were in line with expectations and extend the recent streak of gains. And while 37% of small business owners are raising wages, it hasn’t been enough to move the national needle.
“Small business owners are investing more in their employees to attract and keep qualified workers,”said NFIB President and CEO Juanita D. Duggan., as quoted by Zero Hedge.“Thanks to the recent tax cuts and regulatory reform, owners are able and comfortable investing more in their employees and businesses which further strengthens the economy.”
In short, the economy is just fine.
Actually, scratch that, we’re better than fine. This is the best it’s been in quite some time.
At this current rate, we wouldn’t be shocked to see Dow at 30,000 or the Russell 2000 at 1,850 this year.