|
 The Federal Reserve meets this week and is expected to leave rates
on hold. One factor it watches is slack in the labor market to see
how much room the economy has to grow without triggering inflation.
The share of those 25 and older without high school diplomas who
have jobs or are looking for one has risen 1.4 percentage points to
46.2 percent in six months to March, close to levels before the
2007-09 recession. For high school graduates, that share has risen
by a half percentage point, while among those with college degrees
the rate has remained virtually steady.
The return of less-educated workers to the labor force is a sign
that the economy is still healing from the recession.
Americans with no more than a high school education accounted for
nearly four out of every five jobs lost in the recession, according
to research by economists at Georgetown University. Since such
workers are considered at the greatest risk of being permanently
shut out of the labor force, it fueled concerns that strains in the
labor market might emerge even during spells of relatively modest
economic growth.
 Yet a Reuters analysis of Labor Department data suggests there could
be more labor market slack than the unemployment rate of 5 percent
may suggest because the improving economy has been spurring
less-skilled workers to look for jobs again.
To count as part of the labor force, a worker needs to have held
down a job or have actively searched for one in the last four weeks.
Over the past year, in any given month there were about 6 million
Americans who did not meet those criteria, a million more than
before the recession. Until recently, Nathan Patterson, 24, who left
high school in Illinois without a diploma and later moved to
Raleigh, North Carolina, was often one of them, discouraged by poor
job prospects from looking for work consistently.
Last year, though, a growing number of job openings posted in the
area made him try again and in January he found a job with a company
that processes scrap steel.
"I went from having nothing to having something," he said.
Patterson makes $10 an hour sweeping up, well below the national
average of $25.43 an hour, and trains to operate cranes and
steel-cutting torches.
MORE FOR LESS
North Carolina, where unemployment spiked more than nationally
during the downturn and more workers dropped out of the workforce,
has recovered lost ground faster thanks in part to strong growth in
low-wage sectors such as retail, leisure and hospitality industries.
Nationally, they have created nearly a third of new jobs over the
last year, although they only make up about fifth of total
employment. Those industries also tend pay 30-40 percent less than
the national hourly average, which helps explain sluggish national
wage growth in the past months and absence of significant cost
pressures in the economy.
[to top of second column] |
"There is more room to run in this cycle and that means the Fed can
afford to go slower on rate hikes in the beginning," said Bank of
America Merrill Lynch economist Michelle Meyer.
Economists polled by Reuters expect the Fed to raise rates twice
this year, with the first move possibly in June, proceeding with
caution because of concerns about the impact of global economic
slowdown on the U.S. economy.
Minutes from the Fed's March 15-16 meeting show policymakers
discussed the recent increase in labor participation and that some
noted that slack remained in the labor market.
That slack, in large part is a result of gradually improving labor
force participation driven primarily by more less skilled workers
looking again for jobs, and many finding them.
Across the economy, companies continue to add about 200,000 jobs a
month but the jobless rate has stayed roughly steady since October
as around 400,000 people enter the work force each month, many
finding jobs right away.
In North Carolina, local officials say they see more unemployed
people going to community college to acquire skills that will help
them find a better job, rather than to wait out a weak job market,
which happened a lot during the recession.
Jackie Gregory, 25, for example, lost her job as an administrative
assistant in November 2014 and spent almost a year out of work
because some jobs required a college degree she did not have and
some just did not pay enough to cover child care expenses. Then she
took a three month break to complete a pharmacy technician course at
a local community college and with her qualifications in hand landed
a $12.26 an hour job at a pharmacy's call center.
"If I didn't get that job I would be barely making it right now,"
she said.
(This story has been refiled to fix typo in second to last
paragraph)
(Reporting by Jason Lange; Editing by Tomasz Janowski)
[© 2016 Thomson Reuters. All rights
reserved.]
Copyright 2016 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed. |
