J.P. Morgan: Demand for labour is bouncing back strongly
J.P. Morgan: Demand for labour is bouncing back strongly
As the US economy reopens demand for workers is rebounding very strongly, as shown by the sharp rise in job openings. Businesses are also reporting that they are finding it hard to fill all these job openings.
Yet there are still over 7 million Americans who had a job in February 2020 who aren’t currently working. The key question is how many of these unemployed workers will come back to work once the current boost to unemployment benefits expires and vaccines allow a full return to normal life.
We expect that most of these jobs will end up being filled, but if a shortage of willing and qualified workers were to persist, then it could lead to more sustained wage pressures and inflation.
We discuss the outlook for inflation and how investors can protect portfolios against this potential risk in more detail in our recent On the Minds of Investors article – Monetary and fiscal coordination and the inflation risks.
Number of US job openings per month, millions
Source: BLS, Refinitiv Datastream, J.P. Morgan Asset Management. JOLTS is job openings and labor turnover survey. Data as of 11 June 2021.