Neil Irwin argues that despite recent good news, there are still weaknesses in the economy.
“The thing about the new jobs numbers is that, solid though they may be, they are solid in exactly the same way that most jobs numbers have been solid for the last couple of years. They don’t show the kind of progress on some key weaknesses in the economy that the Fed might like to see if it’s going to move faster, rather than slower, in the path of rate increases.”
“The new numbers don’t offer much sense of progress. The ratio of the population working was unchanged at 59.3 percent, which is only a tenth of a percentage point higher than it was a year earlier.”
“And average hourly earnings rose 0.2 percent, which was what forecasters expected but also doesn’t suggest that wage inflation is starting to break out. That number is up 2.3 percent over the last year, which is hardly the stuff that would fuel fears of excessive inflation.”
“At the Fed, those arguing that it’s time to wean the economy from its reliance on zero rates are likely to win the day. But in terms of the day-to-day experience of American workers and potential workers, the new numbers point to how much repair there is left to take place.”