One of the most important aspects of developing your Business Acumen skills is to know what to do with data that comes into your world from the outside business ecosystem. For example, Jobs Data. Last week, the US Department of Labor released new data from the Bureau of Labor Statistics that showed the US economy only added 20,000 new jobs after several months of averaging over 150,000 per month for the past several months on top of 101 months of consecutive growth.
Based on assessing all the data through Business Acumen skills, observing and working with our clients across almost a dozen major industries, and our own insights, here are five reasons not to worry about the report:
The partial government shutdown made people nervous
Washington is a tough place to be right now and the continued volatility and uncertainty has business leaders and the key decision makers of spending, investing, and hiring very nervous about the future. The government shutdown was downright ugly and the political rhetoric and positioning almost as ugly leading to many people to wonder about what is going to happen next, so they got ultraconservative on hiring.
The growth can’t maintain itself forever
Business history shows that no matter how strong an economy can be, inevitably it is a system of ebbs and flows and over time will even out. A slight slowdown of the economy which was demonstrated by slower job growth in February is natural and not necessarily a precursor to a recession. A recession is a decline in the Gross Domestic Product (GDP) two quarters in a row and the economy is nowhere close to that happening for at least another 3 to 4 quarters. If the jobs growth continues to be flat or worse goes negative, that would be a problem, but for now, this one-month blip is fine and just something to watch for in March.
It’s easy to blame things like the economy on the weather, but many parts of the country experienced extreme weather conditions in February including a polar vortex and several bad storms throughout the country including snow in Arizona. February is already a short month so when you mix in some really bad weather it’s easy to see how things could slip a bit. It will be interesting to see of March surges because of a backlog of jobs being filled simply on account of the weather.
Wages growth is strong
All US workers are taking home more money and that is translating into more disposable income and potentially savings. In February, hourly wages rose by 11 cents even though the average number of hours worked was the same as in January (34.4 hours compared to 34.5 hours). This is another indication that the economy is strong and sustainable. However, this is one of those economic indicators that is also a double-edged sword. If the wage growth continues, that could ignite inflation and if inflation goes up too dramatically, that could cause a recession.
Good people (any people) are hard to fine
The final reason is the most obvious. Good people are hard to find and because the economy is basically running at job capacity with thousands of openings, there is a good chance that the new jobs filled was down because there are literally no workers to fill the open jobs. The war for talent is increasing in intensity every day and that’s another reason why there is no reason to worry right now.