Glimmer of Hope in Jobs Report
After a few days off last week, I’m late to the party on the June jobs report. The report was bland as expected, with no change in the unemployment rate. The economy added 80,000 jobs in the month, not enough to keep up with population growth and certainly not enough to get back to full employment anytime soon. Hopefully, it will finally force the Fed to announce QE3 or a higher inflation target.
However, there was one small nugget in the report that was positive: Wages are rising
Not just wages, but the average work week also increased in June. As Sarah Kliff noted:
Working a few more hours at a slightly higher wage, means workers see a growing paycheck. They might have more bargaining power to demand a higher salary, too.
The fact that wages have been consistently ticking upwards demonstrates that workers have seen higher salaries. This is a good sign. Companies are going to slightly increase wages and their employees’ hours before hiring new employees. While the recovery is slow, firms do not need to rehire workers, but over time, simply increasing wages and hours will not be enough. The economy is not at that point yet, but it is at least on its way.
Of course, the jobs numbers have shown this nearly every month so I’m just focusing on it now, because the rest of the job numbers were so bleak.