Mexico City If you’re trying to gauge the outlook for workers, especially lower waged workers in the USA in the coming year, strap the seat belt tightly, because the ride has a lot of ups and downs, curves and corners. So many economists have different crystal balls they are examining, whether employed by the government, Wall Street, or universities, that it’s hard to be confident of any predictions.
Where there does seem to be some consensus is that after almost historic full-employment rates with statistical unemployment as low as 3.5% across the USA, and even lower in some states and professions, unemployment is expected to increase. Some have it going to almost 6% by the end of 2023, and almost all of them claim it will hit 5%.
That’s not necessarily good news for all of us that need a continuing tight job market to push wages up, especially for lower wage health and service workers. Some economists have made the case that the job shortages in these jobs for essential workers during the pandemic was finally increasing equity. With a number of union contracts coming up in nursing homes and community assisted living facilities, we have our eyes peeled on these trends. The economists that are predicting a slowing of wage increases aren’t bringing us good news. Their argument in too many cases are hiding behind worries about higher wages increasing inflation, yet for lower waged workers, higher wages are desperately needed to try and keep up with the inflation that have already hammered them on living necessities.
There’s another world out there that is unknown to essential workers. The layoffs in tech jobs from the highfliers seem to be offset by increasing demands for tech workers across the economy in banking, healthcare, and basic businesses. Some tech-type companies are reportedly even letting workers choose their pay packages, which seems like something from outer space. Another article recently touted a trend in some companies to give significant raises of 5% and more for workers to simply stay in their existing jobs. Where can we go to get in on that action?!?
More importantly, where does this leave all of us as we approach the new year in this topsy-turvy economy? Inflation is supposedly easing, but some of it, like rent and utilities, rarely go down, once they’ve gone up, even if gas and groceries are a bit cheaper. Wages once given, rarely go down for existing workers as well, but that doesn’t mean that they keep going up or ever get to the level needed.
Looking at some of the charts that try to explain the worker shortages that still exist is interesting. People who took early retirement are mostly saying “been there, done that” and not going back to work. Young ones in their early 20s are also not running to get a job either, which seems to mean that Gen Z is a whole lot smarter than many have argued in the past. They seem to be waiting to see what happens, and at some level, that’s where we all are as we enter 2023.