Fitch predicts full employment won’t happen until Q4 2022
Full employment will not occur until the fourth quarter of 2022, predicts Fitch Ratings.
The prediction comes about a month after Minneapolis Federal Reserve Chairman Neel Kashkari estimated that full employment will take a few years.
The recent severe shock in the labor market has led to an increase in long-term unemployment and has definitely discouraged some older workers who lost their jobs during the pandemic from seeking employment again, Fitch said.
Fitch set the threshold for full employment at an unemployment rate of 4.3%.
At the same time, another type of shock is affecting some employers.
Companies in certain sectors, particularly accommodation, cannot find enough workers. “The stories of general managers cleaning hotel rooms aren’t exaggerated,” said Scott Berman, hotel and hospitality industry leader at PricewaterhouseCoopers.
Restaurants and other industries important to commercial real estate investors are also experiencing shortages.
One of the problems for restaurants to find enough workers, said Alice Cheng of Culinary Agents, an industry job board. CBS News is everyone hiring at the same time. “This poses supply and demand problems from the start.” Another data point: The National Coalition of 7-Eleven Franchisee Associations said the shortage has led many outlets to cut hours.
There has been a lot of talk that pandemic unemployment benefits have made the shortage worse.
The $ 300 a week on top of state-level benefits seems to deter some people from working. And as retailers, restaurants and hotels try to reopen and relaunch business, many scramble to hire enough workerssaid John Chang, senior vice president and director of research services at Marcus & Millichap.
A labor shortage was cited as justification by Republican governors in Arizona, Arkansas, Georgia, Idaho, Iowa, Mississippi, Missouri, Montana, of North Dakota, Ohio, South Carolina, South Dakota, Tennessee, Utah and Wyoming for announcing the cut of the $ 300. payments in June or July.
Meanwhile, the Bureau of Labor Statistics reported this week that employment was up in all states for the year ended in April.
The largest job increases were in California (+1 302 100), New York (+1 029 800) and Texas (+1 007 100). The largest percentage increases were in Michigan (+ 21.1%), Nevada (+ 17.6%) and Rhode Island (+ 17.1%).