Labor Force and The Economy
July 21, 2022
This week we are focusing on the state of our labor force and the impact it can have on our economy.
Employment rates have been on the rise recently, with a job increase of 390,000 in May.1 There are still many more job openings to fill but Mike Fratantoni, Mortgage Bankers Association senior vice president and chief economist, said this is one of the strongest job markets in the past 50 years.1
While this is all great news, some experts believe the job market gains could encourage the government to continue raising interest rates in an effort to combat high inflation rates.1
“Today’s report will likely support additional 50-basis-point hikes by the Federal Reserve at the next two FOMC meetings,” Fratantoni said. “Even if inflation readings show some deceleration, this degree of labor market tightness will likely continue to put upward pressure on wages and prices.”1
While no one knows exactly what the future of the economy holds, it is helpful to prepare an individual financial plan.
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