The weaker-than-expected U.S. job growth in May should not have been a surprise, given the current labor shortage, the Job Creators Network (JCN) said Friday, reacting to the release of the U.S. Bureau of Labor Statistics monthly report.
“The labor shortage is a huge reason” the economy added only 75,000 jobs in May, JCN said in a statement:
"After a sizzling jobs report in April, it shouldn’t be surprising that job growth slowed in May, with 75,000 jobs being added to the economy and the unemployment rate frozen at 3.6 percent. The labor shortage is a huge reason for that. The jobs exist, but employers can’t find qualified workers.”
As a result, working-class Americans are “the biggest winners in today’s economy,” said JCN, a coalition of entrepreneurs co-founded by Home Depot Co-founder Bernie Marcus:
“Additionally, the biggest winners in today's economy are the working class, with blue-collar wages growing at a faster rate than management wages. While the number of retail jobs went down in May, there was growth in the number of warehousing jobs, which is in a positive shift in the jobs mix as they are higher-paying jobs.”
The keys to boosting future job growth are lower interest rates and “continuing the pro-growth policies of this administration,” JCN said:
“To accelerate growth, the Fed should heed JCN's call to cut interest rates by at least a quarter percent, if not half a percent, at their next policy meeting in a few weeks. Even with weaker job growth, there are still clear indications our economy has room to grow: We've experienced nine straight months of wage growth, wage growth hit 3 percent again in May, and inflation remains low and below the Fed's target. The LFPR [Labor Force Participation Rate] is unchanged and prime age LFPR (ages 25 to 54) is 82.1 percent, which is back to pre-recession levels.”
“Continuing the pro-growth policies of this administration, combined with a cut in the Fed's rates, is the policy prescription we need to strengthen the job market and take our economy to new heights."