The job market in the United States is a huge focus for the Federal Reserve, and the U.S. has a ton of departments aimed at increasing employment. In fact, part of the Federal Reserve’s dual mandate is increasing employment and making sure that the money supply is stable by changing around the interest rates.
The National Employment Forecast is Sunny
Ensuring that everyone who wants a full-time job that fits his or her abilities and interests gets one is no small feat, though. Economists even talk about the “natural” rate of unemployment being around four percent: There’s always going to be some unemployment as people change jobs and move to more innovative sectors of the economy.
Over the last year, though, things seem to be trending in the right direction. The country is decisively moving out of the Great Recession and into a period of continuously declining unemployment figures that economists haven’t seen for some time.
The Bureau of Labor Statistics recently found that over a quarter-million jobs were added to the economy in November of 2017 and unemployment is right around that golden mean of four percent since it dropped down to 4.1 percent heading into December.
There’s Still Room for Improvement
Still, the employment rate, if you will, calculated by looking at the labor force participation rate, is surprisingly low. There are also people who have dropped out of the workforce altogether and aren’t looking for full-time employment; another group of Americans are underemployed or can’t find skilled positions in their communities that would pay a living wage for their services.
These States are Trailblazing the Way Forward
Enter the ingenuity of individual states who are growing their economies, offering subsidies to much-needed businesses, and bolstering their overall economies.
When you do all of that, you’re effectively increasing the amount of state tax revenues that you might garner and, thus, improving the chances that your state will spend money on infrastructure improvement and more business subsidies. It’s a recipe for continued success and a study in what a virtuous business cycle looks like close up.
The Evergreen state in the U.S. northwest is officially the nation’s fastest growing state economy. The IT sector in Washington is particular robust, but so too are private sector blue-collar jobs in the logging and mining industries. With all of these jobs readily available, the construction industry and hospitality (e.g., restaurants and hotels) industry is going fantastic in Washington as well. Washington has roughly matched the national growth rate with 2.35 percent growth in 2017 and added more than 76,000 jobs to the economy. IT, construction, and logging are all set of increase further.
Washington is a standout for job growth, but the Centennial State shines in the sense that it has the lowest unemployment rate in the United States at an incredible 2.3 percent. That’s more than 1.5 percentage points under the “natural” rate of unemployment, which means that Colorado’s economy has tons of full-time work on offer to qualified applicants. The service sector is experiencing moderate job growth, but the lion’s share of improvement has been in Colorado’s IT sector. Interestingly, both Colorado and Washington raised their minimum wages to over $9 and $11, respectively.
Tech companies in Utah are heavily contributing to the 3.28% year-over-year job growth that Utah is experiencing right now. Utah’s economy is consistently rated within the top 5 in the country, and the state’s tech sector is complemented with job growth from the services and construction industries. The falloff in mining jobs is being replenished by jobs in IT, services, and construction.
This goes to show that a vibrant economy is often one that flexibly responds to changes in business trends and current consumer tendencies. The strongest economies are ones that prioritize innovation through subsidies and make hiring easier.
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