Here’s Why the Job Market Is Improving
The White House was probably thrilled to announce in its update on employment in January that the nation has now seen 11 months in a row of job gains over 200,000 (and that’s for the first time in almost 20 years). We keep hearing that the economy is picking up and there’s been substantial job growth, so with the help of data from Pew Research Center and the White House, let’s break down what signs there are that the job market is improving.
The longest streak of job growth on record
According to the White House, the private sector has added 11.8 million jobs in 59 straight months of job growth, extending the “longest streak on record.” According to Gallup, the growth in hiring we saw at the end of 2014 is rolling over nicely into 2015. Gallup’s U.S. Job Creation Index was at +28 for January, up a point from December, and still chasing the seven-year high of +30 it reached in September.
In addition, total nonfarm payroll employment rose by 257,000 in January, and private-sector job growth was revised up for November and December by a total of 149,000 jobs. Over the past 12 months, private employment went up by 3.1 million, making it the most successful year since 1998.
Shorter unemployment periods
An obvious good sign of the job market improving is people spending less time unemployed. In January, the median duration of unemployment was 13.4 weeks. This is still not at the typical pre-recession levels of about eight or nine weeks, but it’s better than last year. There was also an improvement from last year’s numbers in the amount of unemployed people who had been jobless for fewer than five weeks, so a shorter stretch of unemployment is making up more of the jobless numbers.
Last month 2.4 million people or 26.8% of the total unemployed had been jobless for fewer than five weeks, compared to 24% in January 2014. In addition, there was a decrease in the percentage of unemployed who had been jobless for more than 26 weeks, dropping from 35.6% to 31.5% in the past year.
People aren’t afraid to quit
Though it might say something bad about an employer, quitting is a good sign for the job market because it means people aren’t as afraid about their employment (and opens up a job). In September 2010, voluntary quitters accounted for just 5.5% of the unemployed, but last month, 9.5% of the unemployed were people who quit their jobs.
The number of people quitting their jobs voluntarily began to rise last year, according to the most recent Job Openings and Labor Turnover Survey. In September, nearly 2.8 million Americans quit their jobs, which was the most since April 2008, according to the Labor Department. The latest numbers, which are from September-November, show that 8.1 million people voluntarily left their jobs. This is the highest number of people quitting over a three-month period since 2008.
More people looking for work
The Great Recession caused many Americans to lose their jobs and its after effects have stopped a lot of people from even looking for jobs. What gets Americans looking for jobs is their confidence in the economy. According to Gallup, last month we had the most positive perception of hiring at our places of employment in any January since 2008. However, a lot of that positivity bloomed earlier in 2014 and fell off. On the other hand, Americans’ confidence in the U.S. economy improved by 8 points from December to February, and in January 45% of Americans said it was a good time to find a quality job, up from 36% in December.
That confidence seems to be translating into job hunting. According to Pew, the amount of those who “want a job but haven’t looked for one lately” have fallen by 564,000 since May 2014. In addition, the number of people who say “they haven’t looked for work because they’re discouraged about their prospects” fell from 837,000 in January 2014 to 682,000 last month.