MOLINE, Ill. — The labor market looks good on paper - 431,000 new jobs were added to the U.S. economy in March 2022. While that was below Wall Street's forecast of 490,000, the unemployment rate fell from 3.8% to 3.6%. So, why is there concern?
GMQC Financial Expert Mark Grywacheski with the Quad Cities Investment Group joined us live on GMQC Monday, April 4. He said the labor market is "relatively" strong, but there is a growing list of challenges facing the U.S. economy right now: inflation is at a 40-year high, interest rates are rising, we will have supply chain issues and the war in Ukraine.
"All things considered, we’re going to be relying on the labor market to overcome a lot of these obstacles," he explained.
The challenge is the labor shortage. Grywacheski sid we need it to rebound from COVID-19:
"Back in March/April 2020 the labor market lost 22 million jobs," he said. "But here we are, two years later, and we’ve yet to recapture 1.6 million of those lost jobs and one of the biggest challenges is getting people back to work.
There are currently a near-record 11.3 million unfilled job openings across the nation. This is 60% higher than before the pandemic. Then look at the labor participation rate (below), which reports the percentage of Americans that are either working or actively looking for work. The LPR is still at its lowest level in decades. This means that millions of Americans that were once working are no longer working, and, more importantly, are not even looking for work."
Grywacheski shared his outlook. He expects we'll see steady job growth throughout the rest of the year, but in 2023 "the picture gets a bit cloudier."
To see why, watch our entire interview by clicking the video above.
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