According to a Labor Department Report release Friday, more Americans are entering the workforce.
The number of African Americans, in particular, looking for work has spiked by 62.2 percent in June. Four million African-Americans were either working or looking for work in last month.
“Friday’s Labor Department report showed the share of American adults working or looking for a job rose by 0.2 percentage point to 62.9% in June. This development in rising workforce participation helped drive the unemployment rate up to 4.0% in June. Unemployment rates for African Americans and those who haven’t completed high school also rose in June,” writes The Wall Street Journal.
“You’re really seeing that particularly in this tight labor market, those workers who may have felt that they were missing out on the recovery are starting to see some traction,” said Martha Gimbel, Indeed Hiring Lab director of economic research to WSJ.
Not to mention, African-Americans are now in their prime working years. The median age for non-Hispanic white workers was 43.5 in 2017 and 34.2 for blacks.
“You would expect the aging of the population to be weighing on white Americans more than it is on black Americans,” said Gimbel.
As employers struggle to find workers, less-educated Americans are getting hired in positions they may not have been hired for in the past.
“When employers run out of workers, that’s when people with the weakest bargaining positions get put in the driver’s seat and can negotiate for better pay and get themselves into roles,” said Andrew Chamberlain, Glassdoor chief economist to the WSJ.
The boom in the e-commerce sector has helped to contribute to the recent decrease in the unemployment rate for the less-educated.
The number of job openings was at a record high in May with 223,000 new jobs added. According to the latest Labor Department report, 213,000 jobs were added in June.
“One broader measure of underemployment, the U-6 rate that includes discouraged and part-time workers, edged up to 7.8% in June from 7.6% a month earlier. Labor force participation rates also remain well below pre-crisis levels, suggesting there’s still more room for people to enter the workforce,” writes the WSJ.
Author’s note: Although it’s great to see a low unemployment rate, this metric is actually an incomplete indicator. When the labor force participation goes down like it did during the Obama administration, the unemployment rate doesn’t reflect the millions who have given up looking for work and instead, just started to collect welfare. But it looks like the overall labor participation rate is starting to inch up, which means more people are rejoining the workforce.