Wednesday, December 13, 2017

The Stubborn Hiring Rate

The unemployment rate has fallen to a 17-year low, remaining at 4.1 percent for two consecutive months now. But for some reason, the rate at which employers are hiring new workers has yet to break out.

The hiring rate, or the share of newly filled jobs to total employment, has remained remarkably steady for three and a half years. The rate improved to 3.8 percent in October from 3.6 percent in September, the Labor Department said yesterday. That increase matched a post-recession high achieved three previous times since late 2015, but the figure has yet to match pre-recession peaks.

The hiring rate has held in the fairly narrow range between 3.5 percent and 3.8 percent since April 2014. Like the hiring rate, growth in average hourly earnings has also been stuck in neutral for about three years.

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