Hiring slows in December as worker shortage still presents challenges

Geoff Bennett:

Today's jobs report signaled good news for those who are worried about a recession and inflation. It also capped a very strong year for the jobs market overall, more than four-and-a-half-million new jobs created in 2022. That's the second highest year ever since record-keeping began back in 1939.

But it still suggest that it's hard to find enough workers for some jobs.

Economics correspondent Paul Solman has this report.

Paul Solman:

The final jobs report of 2022 hints that this year's economy may be OK after all.

Julia Pollak, ZipRecruiter:

There is nothing to complain about in the December jobs report.

Paul Solman:

ZipRecruiter jobs maven Julia Pollak says, on top of 223,000 new jobs and a rock-bottom unemployment rate of 3.5 percent, the report highlights a key metric that will make the Fed happy, though not workers.

Julia Pollak:

It showed wage growth moderating, which is exactly what the Federal Reserve wants to see and which reduces the risk of a recession.

Paul Solman:

Because it reduces the danger of continued inflation?

Julia Pollak:

Yes, because it reduces the risk of continued inflation and of the Fed needing to throw too much cold water on the labor market.

Paul Solman:

In the context of the COVID years, Pollak says 2022 turns out to have been just right.

Julia Pollak:

The December report suggests that 2022 was a Goldilocks year in the labor market.

Paul Solman:

A Goldilocks year?

Julia Pollak:

Yes, well, 2020 was much too cold with the millions of jobs lost. 2021 was too hot. We added 6.7 million jobs, and the result was surging inflation.

This year, we saw 4.5 million jobs added, so still an enormous number, but not so large that it caused inflation. In fact, inflation moderated and wage growth moderated.

Paul Solman:

But even with an employment report this strong, the labor market remains spandex-tight.

Why, I asked Pollak, earlier in the week.

Julia Pollak:

Well, before the pandemic already, there was a downward trend in labor force participation that was mostly driven by the fact that we have a rapidly aging population.

Paul Solman:

True in Canada and Europe as well, with myriad job openings.

But Pollak cites causes peculiar to America.

Julia Pollak:

One is a decline in participation among working-age men that one doesn't see in other countries. And then also labor force participation women, prime-age, working-age women is rather sort of sluggish and flat, even though it's growing pretty rapidly in other developed countries.

Paul Solman:

What's the explanation?

Julia Pollak:

The rates of crime, incarceration, which are barriers to employment. Another is the increase in the use of drugs like opioids and fentanyl, which are also keeping people out of work.

Paul Solman:

And the plateauing of women? Not happening in Europe or Canada.

Julia Pollak:

Mostly because other countries have family-friendly policies like paid family leave, and the U.S. does not.

Paul Solman:

I have been hearing two other reasons, the slowdown in working-age immigrants and for years now from employers all over this land that young people just aren't interested in so many of the jobs out there, trade jobs, face-to-face, the military.

As Karen Paolucci, head of industrial robot maker Yushin in Rhode Island told me:

Karen Paolucci, Yushin America:

You can schedule someone for an interview, and they don't even come for their interview.

Paul Solman:

And I have heard a harsher charge from numerous employers in recent years: Today's young Americans just don't have the work ethic of the past.

The response we got?

Jennifer Riordan, Kansas:

I have work ethic for the things that I want to work on, that I feel will better myself and be good for my health as well.

Paul Solman:

Would Jennifer Riordan of Lawrence, Kansas, who calls herself not a housewife, but an apartment wife, take a front-line job?

Jennifer Riordan:

I would do that if I knew that my labor would be valued, that my personhood would be valued, that I wouldn't just be another cog in this machine that keeps endlessly grinding us downwards.

Paul Solman:

College-degreed 22-year-old Fable, who goes by first name only, what was the stress like working at Starbucks?

Fable, California:

Unbearable, just constant or nonstop. I think that's a good way to put it. If we were paid enough to actually survive, then, yes, the sound — then I could probably handle at least some of the stress some of the times.

Paul Solman:

Fable says the options are go back to school.

Fable:

Or I go to one of what we — quote, unquote — call "unskilled jobs," and then I don't even have enough to afford living outside of my parents' home, which I'm doing anyway, without working. So, might as well just do that.

Paul Solman:

Just two data points, what I call anecdata. But is it some evidence of the entitlement charge?

Julia Pollak:

If you go and sit in the archives, you can find newspaper articles and radio segments dating back hundreds of years, where people make the same argument about the young.

Paul Solman:

Bottom line today, it may still be hard to find good help, but if your main worry was recession in 2023, layoffs, bear market, today's jobs report is being viewed as something of a storybook ending for 2022.

For the "PBS NewsHour," Paul Solman.