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BUSINESS Monday 7 august 2017
A25

US Economy:

Jobless rate raises question: How much better can it get?

By CHRIS RUGABER reached in January 1999.
AP Economics Writer The unemployment rate
WASHINGTON (AP) — A fell to a three-decade
drop in the unemployment low of 3.9 percent the fol-
rate to a 16-year low rais- lowing year, in April 2000.
es a tantalizing question That represented the best
about the job market: How of all worlds: A low unem-
much better can it get? ployment rate with a lot of
Earlier this year, economists people working or looking
worried that the low un- for work. Economists doubt
employment rate meant the jobless rate can fall that
businesses would struggle low again without touching
to find workers and that off inflation, as employers
would drag down the are forced to offer higher
pace of hiring. Those fears pay to attract workers from
were heightened by a a dwindling supply of un-
tiny job gain in March and employed. That, in fact, is
modest hiring in May. why the Federal Reserve
Yet Friday’s jobs report has raised short-term inter-
suggests such concerns est rates three times in the
are premature. Employers past seven months, which
added 209,000 jobs, after they hope will forestall fu-
a solid gain of 231,000 in ture price increases.
June, the Labor Depart- Cheryl Bast, left, is accompanied by her daughter Liz Pierson, as she works on an application for a But many economists wor-
ment said. The unemploy- position with Omaha Public Schools, during a job fair held at Omaha South High School in Omaha, ried that the ultra-low un-
ment rate ticked down to Neb. A drop in the unemployment rate to a 16-year low raises a tantalizing question about the job employment rate in 2000
4.3 percent, from 4.4 per- market: How much better can it get? would touch off inflation,
cent, matching the low (AP Photo/Nati Harnik) and it did not. The econo-
reached in May. Growth, a liberal think tank. dent Barack Obama’s for- job or were looking for one my at that time benefited
The U.S. economy is ben- President Donald Trump mer top economic adviser, rose to 81.8 percent, up a from much higher rates of
efiting from steady growth celebrated the data in a Jason Furman, noted the half-percentage point from productivity growth, which
around the world, with Eu- tweet shortly after the num- slip-up, calling it a “minor a year earlier and the high- allowed employers to raise
rope and Japan perking bers were released. “Ex- transgression.” The pace est since December 2010. pay and hire more without
up and China’s economy cellent Jobs Numbers,” he of hiring so far this year, Economists focus on that having to lift prices.
stabilizing. Corporate rev- wrote, “and I have only just while solid, is pretty much age group because it filters There’s also no way to
enue and profits are grow- begun.” Trump technically the same as it was last year out the impact of retire- know whether the propor-
ing too, and the stock mar- tweeted too early: His com- under Obama. Employers ments by the huge baby tion of people working or
ket has hit record highs. ment was posted at 8:45 have added an average boomer generation and looking for work could re-
Economists were particu- a.m., just 15 minutes after of 184,000 jobs a month excludes younger workers turn to its 1999 peak. Many
larly encouraged by the the report was released. through July, compared who are more likely to be economists are doubtful, in
fact that more Americans Federal rules specify that with 187,000 in 2016. Month- in school. That means more part because it rose sharply
are coming off the side- White House officials should ly job gains topped 200,000 Americans are optimistic in the 1980s and 1990s as
lines and finding jobs. For wait for an hour before on average in 2014 and about the job market and women flooded the work-
the first few years after the publicly commenting. The 2015. The steady hiring is launching job searches. But force. The proportion of
recession, many of the un- rule is intended to allow adding up. In July, the pro- that proportion is still sub- women working or looking
employed stopped look- the data to be released portion of Americans aged stantially lower than the all- for work has slipped since
ing for work. Some were without political spin. Presi- 25 through 54 who had a time peak of 84.6 percent, 2000.q
discouraged by the lack of
available jobs. Others re-
turned to school or stayed
home to take care of fami- US trade deficit narrowed to $43.6 billion in June
ly. The government doesn’t
count those out of work as By PAUL WISEMAN beans, computer acces- this year, the trade deficit with China rose 3.1 percent
unemployed unless they AP Economics Writer sories and other products. is up 10.7 percent to $276.6 in June to $32.6 billion and
are actively searching for WASHINGTON (AP) — The Services exports reached a billion. is up 6.1 percent to $170.7
jobs. That trend began to U.S. trade deficit narrowed record $65.4 billion. The deficit means the Unit- billion so far this year.
reverse last year and has in June as exports hit the U.S. exports may be get- ed States is buying more The goods deficit with
continued into 2017. To highest level in 2 ½ years. ting a lift from a pickup in goods and services from Mexico slid 18.3 percent
many economists, that The Commerce Depart- global economic growth other countries than it is sell- in June to $6 billion. The
means robust hiring could ment said this weekend and a drop in the value of ing them. A shrinking trade Trump administration is pre-
continue for many more that the trade gap slid 5.9 the U.S. dollar against other gap boosts U.S. economic paring to renegotiate the
months, or even years. percent in June to $43.6 bil- currencies. A weaker dollar growth. President Donald North American Free Trade
“There’s more people will- lion. makes American products Trump has vowed to bring Agreement with Mexico
ing to work than the un- Exports of goods and ser- a better bargain in foreign down America’s trade defi- and Canada. Trump has
employment rate would vices rose 1.2 percent to markets. Overall imports cits, saying they are caused complained that NAFTA
have you believe,” said $194.4 billion, the highest slipped 0.2 percent to $238 by bad trade deals and encourages U.S. manufac-
Nick Bunker, a senior policy amount since December billion on a drop in demand abusive practices by China turers to move to Mexico to
analyst at the Washing- 2014 on higher foreign de- for cellphones and other and other U.S. trading part- take advantage of cheap-
ton Center for Equitable mand for American soy- household goods. So far ners. The deficit in goods er labor.q