Get this: The U.S. is about to end 2018 on one of the most remarkable hiring streaks in American history.
That’s right. Later this week the government is expected to report the economy added around 200,000 new jobs in the final month of 2017. The December employment report will be released Friday.
If so, it would represent the seventh straight year the U.S. created more than 2 million new jobs.
Since World War Two, the only other time that happened was from 1993 to 1999.
Adding it all up, the U.S. has generated almost 18 million new jobs since 2010.
A lot of the hiring reflected the usual pattern that occurs after a recession. The U.S. lost a whopping 8.6 million jobs in 2008 and 2009 during the worst downturn since the Great Recession.
The improvement in the labor market, however, has been much stronger than the normal post-recession rebound.
The unemployment rate has fallen to 4.1% and matched a 17-year low, for one thing. Job openings are at a record high. And a recent survey found that only 15.2% of Americans said jobs were “hard to get” — a 16-year low.
Alas, all good things have to come to an end.
Many economists expect hiring to taper off to fewer than 2 million new jobs 2018, but not because of anything bad. It’s just that the U.S. is running out of workers. Baby boomers continue to retire in droves and immigration laws have been tightened, keeping a cap on the supply of labor.
A slowdown might not happen right away, though. The recently passed tax cuts, for instance, could turbocharge business investment and hiring early in the year.
Higher investment is the key to solving the one big puzzle of an otherwise healthy labor market: Slow wage growth. Paychecks are not getting much bigger each year even though companies have to compete harder for workers. The average worker is getting about a 2.5% raise each year.
“U.S. wage growth is weak as we close out 2017,” noted Glassdoor, a private firm that researches the labor market.
Yet if businesses invest in ways that help workers become more productive — by buying new computers, for example — firms would able to pay higher wages.
Even if wages don’t rise much, though, Americans aren’t going to let it get them down. Consumer confidence recently hit the highest level since 2000 and businesses are the most optimistic in years.