4 cures needed to treat shrinking labor force, staffing exec says
Q: There are more than 5.5 million jobs open in America and we have a low unemployment rate of 4.7 percent. Still, only 27 percent of Americans are satisfied with the economy, according to December findings by the Bureau of Labor Statistics and Gallup polling. Don't low unemployment rates typically signal a strong economy?
A: Historically, yes. Lower unemployment rates have coincided with positive sentiments about the economy and the country; they've been the go-to metric for economists, journalists, politicians and commentators. But they're not a true depiction of the state of today's economy.
Q: So what's causing the negative view of the economy?
A: Four factors: the shrinking labor force, the wage debate, business confidence and the post-recession hangover. Wages have been slow to recover following the Great Recession and concerns of inequality are high. Businesses are concerned about political and global uncertainties and, still suffering from the aftermath of the Great Recession, they're holding back, sitting on cash and being cautious. Meanwhile, and perhaps most importantly, many job seekers have given up hope and quit the workforce and they're not being counted among the unemployed. The skills gap in America also is contributing to low labor force participation. The available workforce is not trained to do the jobs that are open in America. What's more, 70 percent don't plan to go back to school to make themselves more marketable, according to a Harris Poll commissioned by Express.
Q: Now what?
A: President Trump, his administration and the new Congress should zero in on four cures to jump start the economy:
•Getting more workers off the sidelines and back in the workforce with good-paying jobs by equipping them with the skills needed to do those jobs. Business may not have created this problem but it's on businesses to solve it in the short-term.
•Raising wages — not artificially with minimum wage laws — but through a growing economy.
•Relieving businesses of regulations, rules and barriers to success.
•Encouraging businesses not to be overly cautious, while promoting policies that encourage reinvesting in the economy.