The Jobs Report was released today and on the surface it was a bit of a letdown. With only 148,000 new jobs created last month, the news momentarily squashed the felt euphoria from the flurry of cheerful data released so far this week. I’m here to tell you that the celebration can continue and here’s why: The average rate at which jobs have been created in the U.S. is 210,000 per month, and there have been over two million new jobs created every year for the last seven years! There are about 124 million people working full time in the U.S., and our population is growing at a rate of only 0.7% per year, so the 1.6% rate of new employment opportunities outpaces population growth by 2X. And that means that employers have to pay more to attract the help, which is one reason that wages increased by 2.5% last year alone. So if you are willing and able to work, that’s good news.
All that comes at a cost, however, and that will be higher interest rates in the future. With the Fed raising three times in 2017 and committing to three more in 2018, those in the know are forecasting the 30 year rates to end the year about 1/2% higher than present levels, which are still pretty attractive.