Jobs Are Plentiful? Tell That to the Unemployed

Americans seemed to have received some good news Friday on the labor market: The unemployment rate in December fell to 4.4% from a revised 4.5% in the November (highly noisy) monthly report. The stock market reacted by climbing toward a record, and bond traders pared bets that the Federal Reserve would continue cutting benchmark interest rates to protect jobs. And yet, key parts of the report from the Bureau of Labor Statistics suggest that while conditions may not be deteriorating, the ground is shaky.

Consider the increasing duration of unemployment. The number of US workers who have been unemployed for 27 weeks or more rose to 1.95 million in December, the most since December 2021. Proportionally, that means that about 26% of the unemployed have been in that condition for half a year or more. In today’s economy, a surfeit of layoffs was never the problem so much as a lack of opportunities for those in need of a job. It’s far from clear that’s improving.