A Closer Look at The Stir in US Employment: Native Vs Foreign-Born Workers
Key Takeaways:
– Over one million fewer native-born Americans hold jobs compared to last year.
– During the same period, the number of employed foreign-born workers increased by around 400,000.
– Despite an increase in nonfarm payroll jobs, the unemployment rate rose to 4.2%.
– Critics argue that government spending largely supports recent job growth, not innovation or productivity.
– Real wages remain below the levels of 2021’s first quarter, and inflation is impacting the standard of living.
A Change in the U.S. Labor Market
Remarkably, data from the Bureau of Labor Statistics (BLS) indicates that the number of employed native-born Americans fell by more than a million this past year. At the same time, around 400,000 more foreign-born workers found employment. Furthermore, October to November alone saw a drop of 215,000 native-born American workers. This changing scale seems to be shaping a new pattern in America’s labor market.
Distrust Toward Current Administration’s Economic Policies
Some experts express concerns over the labor market’s shifting dynamics under the Biden administration. For example, E.J. Antoni, a research scholar at the Heritage Foundation’s Hermann Center, describes Biden’s economic legacy as a transformation of America’s labor market into a temporary service agency for foreign workers and government office holders. According to Antoni, this trend risks sacrificing the economic interests of blue-collared America.
Jobs Added, But Unemployment Rates Rise
Despite the unsettling trend, it’s not all doom and gloom. As per BLS data, the addition of 227,000 nonfarm payroll jobs in November beat economists’ expectations. However, the unemployment rate didn’t reflect this progress, climbing from 4.1% in October to 4.2% in November.
Where Is Job Growth Happening?
Most job growth appears to be largely tied to government expenditure. In October, the government added 33,000 jobs, and the healthcare industry saw an increase of 54,000 jobs. Furthermore, in 2022 alone, government sources were responsible for more than 45% of healthcare spending. According to Peter Earle, senior economist at the American Institute for Economic Research, government spending, not entrepreneurial innovation or productivity, fosters most economic growth of late.
What Does This Mean for Native-Born Workers?
Unfortunately, native-born employment still languishes below its pre-pandemic trend, while foreign-born employment seems to have recovered. In fact, foreign-born employment is now credited with all net job growth over the past five years.
How Have Wages and Inflation Been Impacted?
While jobs are increasing, wages are failing to keep up with the cost of living. Third-quarter real wages in 2024 are still languishing below their 2021 levels. Meanwhile, prices have skyrocketed by more than 20% over the same period. This inflationary surge, from 1.4% at the end of the Trump era to around 9% in June 2022, poses a significant concern.
An Unfazed Administration
Despite growing concerns, the White House portrays the job situation positively, highlighting that the job market remains robust under the Biden-Harris administration. However, they’ve yet to respond to growing criticisms or requests for comment on the present circumstances.
Undoubtedly, these complexities of the US labor market will continue to be a focus for policymakers, economists, and American workers in the years to come.