Hands down, the job market is the best it’s been in 45 years.
Unemployment in Kansas is a rock-bottom 2.5%; 3.6% for the country. If you’re looking for a job, employers are rolling out the welcome mat.
College graduates have never had it so good, which especially bodes well for our young people looking to start their careers.
For the last 11 months, the United States has added more than 400,000 jobs per month, the longest such stretch of growth on record.
To add to this wonderful news, wages are up, especially hourly wages for those at the lower end of the pay scale.
The fly in the ointment, of course, is inflation — when the rising cost of goods lowers your purchasing power.
So far, it’s maintainable, precisely because wages are up and people have jobs.
Yes, some things cost significantly more. But on average, economists say today’s 8% inflation rate is making only a 1% to 2% difference in our overall purchasing power.
But what about that darn gas pump?
Well, we’ve certainly seen it lower — and higher.
Kansas is averaging $3.67 a gallon.
And it should be noted that the price at the pump has nothing to do with inflation or who’s president and everything to do with global trade and production. Unfortunately, politicians play us as fools when it comes to the price of gas, either taking credit or placing the blame as its price fluctuates.
Even so, the current rate of inflation must be brought down to avert an economic slowdown.
SOME PERSPECTIVE helps us realize how today’s challenge is manageable.
The yardstick economists use dates back to the 1980s.
Since 1965, inflation had steadily increased from 1% to 14% in 1981, sapping the strength of the U.S. economy. Unemployment was bumping 11%. The stock market was in the dumps. Oil prices off the charts. Economic growth was stagnant.
What changed that paradigm was the new chairman of the Federal Reserve Board, Paul Volcker, who ended the days of “easy credit,” by raising short-term interest rates — at one point to as high as nearly 20% — in order to stabilize the economy.
Simply put, Volcker didn’t believe the government could tax and spend its way to full employment and that it was the Fed’s job to restore price stability.
