By Isaac Cohen*
The creation of 248,000 new jobs in September, announced last week by the US Labor Department, brought the monthly average of job creation in 2014 to 227,000, the strongest figure in almost 30 years. The unemployment rate decreased to 5.9 percent, a figure not seen since 2008.
Job creation was robust in almost all sectors, except in manufacturing, with professional and business services leading, while healthcare, retail and even construction registered vigorous numbers.
However, there were also indications of persistent “underutilization of labor resources.” Confirming the recent description by Federal Reserve Chair Janet Yellen, the rate of participation in the labor force, or the percentage of persons working or looking for jobs, fell to 62.7 percent, a figure not seen in 36 years. Also, the percentage of the population employed remained at 59 percent, the same as the last four months and less than 59.4 percent, the level registered in June 2009, when the recession officially ended.
Meanwhile, inflation remains subdued. Wages fell slightly in September and have increased only 2 percent since last year, just above the rate of inflation, which remains under the central bank objective of 2 percent.
Therefore, in this context of robust job creation, with some lags and low inflation, the central bank can still be patient for a while.
*International analyst and consultant. Commentator on economic and financial issues for CNN en Español TV and radio. Former Director, UNECLAC.