‘In November, the U.S. unemployment rate fell back to 3.5%, the lowest in nearly a half-century,’ the Bureau of Labor Statistics says
The incomes of the bottom 25% of U.S. wage-earners are rising at the fastest rate of all groups of employees, according to data published by the Federal Reserve Bank of Atlanta.
The wages of the lower-most quartile grew by 4.5% in November from a year earlier, according to the Fed, while wages for the top 25% increased by 2.9% over the same period. The last time the wages of the bottom 25% of wage-earners grew at 4.5% was in August 2008, and before that, in October 2002.
Dynamic wage growth among the lowest-earning cohort is indicative of an increasingly tightening labor market.
The Atlanta Fed also found that the highest wage growth in November was noted for workers in finance and business services, 4.1%, followed closely by manufacturing, 4%, and construction and mining, 4%.
Employees in the education and health industries experienced the lowest earnings gains in the same month, coming in at 3%.
More workers to qualify for overtime pay in 2020
An additional 1.3 million workers will see an increase in pay in the new year, after new rules from the Labor Department go into effect, Jan. 1.
Under new federal rules, more workers will be eligible for overtime pay if they log more than 40 hours a week, after the department raised the threshold – the first time in more than 15 years – for when employees are exempted from being paid overtime.
The new threshold will rise to $684 per week or $35,568 a year, which is a 50% increase from the current threshold of $455 per week or $23,660 a year. The rules will also allow employers to cover up to 10% of the threshold with bonuses and commissions that are paid at least annually or more frequently.
The purpose of the new threshold is to exempt executive, administrative or professional employees from the Fair Labor Standards Act’s minimum wage and overtime pay requirements, the department said. It added that the new threshold would take into account wage and salary growth since 2004.
Sustained labor market strength
The number of Americans filing applications for unemployment benefits fell last week, in a sign of ongoing labor market strength.
Initial claims for state unemployment benefits declined 13,000 to a seasonally adjusted 222,000 for the week ended Dec. 21, the Labor Department said Dec. 26.
In November, the U.S. unemployment rate fell back to 3.5%, the lowest in nearly a half-century, the Bureau of Labor Statistics said.
“Notable job gains occurred in health care and in professional and technical services,” William W. Beach, commissioner of the Bureau of Labor Statistics, said.
Unemployment rates were lower in November in seven states, higher in five states, and stable in 38 states and the District of Columbia, the Bureau of Labor Statistics reported Dec. 20. Seven states had jobless rate decreases from a year earlier, two states had increases and 41 states and the District of Columbia had little or no change.
Figures showed that in January 2019, the unemployment rate among men 20 years old or older was 3.7%, while the jobless rate for women in the same age bracket was 3.6%. In November, the unemployment rate for both combined fell to 3.2%.
By comparison, joblessness among the cohort of 16- to 19-year-olds ticked down to 12% in November, compared to 12.9% in January. Peak unemployment for this group in the past two decades hit 27.2% in October 2009.
Joblessness among African Americans reached historic lows in 2019, falling to 5.5% in November from 6.8% in January.
Labor market strength is underpinning consumer spending, keeping the economy on a moderate growth path, despite headwinds from trade tensions and slowing global growth that have weighed on manufacturing.
Janita Kan and Reuters contributed to this report.
Reprinted with permission Copyright (c) 2019 The Epoch Times, Edition 12/30/2019