10 Signs That Job Market is Improving

On April 11^th, Cindy Perman of CNBC news posted an article called “10 Signs that job Market Is Improving.” Indeed, the article listed 10 factors that signal a recovery of the economy after the recession in 2008. So, here are the 10 factors:

1. Jobs have been continually added. After the last recession which caused job losses for two years, number of employment have been increased continually for 18 months.
2. Companies are not lying off employees anymore. According to the article, “planned layoffs hit a 10-month low in March, down 27 percent from February and 8.8 percent from a year ago.”
3. New jobs are created. According to it, the number of jobs opening (not number of added jobs) has increased 16 percent in February from previous year.
4. Companies also continually plan to hire more employees, increasing 16 percent in March from previous month.
5. The jobs have been increasingly opened in particular cities.  
6. Hospitality industries such as hotel, restaurants, or house services revealed a great increase in hiring, 48 percent in March from previous year.
7. Jobless claims dropped to the lowest 378,000 since April 2008
8. The growth rate of national wage increased 1.4 percent in the first quarter, equaling to the rate at pre-recession.
9. There are still shortages on many types of jobs which wait for perspective workers to acquired required skills. They are usually fall in technology and healthcare industries.
10. People are voluntarily to quit their current jobs to seek better jobs, meaning that there are many opportunities on the current job market which is attractive enough to persuade people to quit their jobs. According to the article, the percentage of employees who voluntarily quit their jobs has risen to 4 percent.

Overall, these factors are all about employment rate and are showing that more and more people have been hired! It is good news because it signals the economy is recovering! Indeed, companies are hiring more employees resulting increase in national income. As the result, consumption is expected to increase as people have more incomes to spend. In turn, it causes companies to produce more, meaning more employees would be hired. The round only stops when companies over-produce. Indeed, at this point of time, we are still very far from over-production as unemployment is still very high; it is still ranges between 8 to 9 percent. Thus, the economy may still recovering/growing during the next few years before finishing its cycle to enter another recession.

Still, how fast is the economy recovering?

While reading the article, I keep asking myself this question. Indeed, after the recent great recession which ended in 2008 as unemployment rate stops rising and starts decreasing, the fact that the market has been recovering seem to very obvious. However, the most important question is how fast it is recovering. Which indicators may appropriately show how fast the economy is growing? It is a tough question that we need to know in order to know exactly where the economy currently is and how it is expected to be in next few years. Unfortunately, the article does not discuss on this issue and thus I could not answer myself this question. After all, academic theory usually suggests indicators such as consumer confidence to be a good choice.

Click here to read the article.