2020 is here, and now we are starting to read some of the statistics that are emerging as the various agencies of the federal government release accumulated data from all corners of our economy for last year, as well as the decade that just ended.
One of the most significant is the December report from the U.S. Department of Labor, announcing that 145,000 jobs had been added that month, capping an unprecedented decade of job growth worth reviewing.
First, you have heard me say that sentiment is a key driver of our economy, as 70% of GDP is driven by the American consumer. But what drives sentiment in a positive direction? It’s simple: jobs.
When a husband and wife are both working and their companies are expanding, profits are up, and hiring continues, job holders feels good about their future; they then open their wallets, and that spending drives the economy.
This mood is bolstered by their family, friends and neighbors who are also experiencing the same positive sentiment about their job future, and these positive feelings permeate the American consumer.
Today, credit card debt is at all all-time high, a sign that consumers are confident. The average credit card debt per U.S. household was $8,500 in October 2019, so that amounts to $1.088 trillion in total credit card debt when it is divided by 128 million U.S. households. This is a whopping 8.8% higher than in September, and exceeds the pre-Great Recession record of $1.02 trillion reached in 2008.
The popular business press has been enthusiastic about reporting how the decade that just closed broke records in a variety of areas on the employment front. December’s jobs report capped a decade of payroll gains, the longest stretch in 80 years of record-keeping.
For all of last year, employers added 2.11 million jobs, which was a slowdown from 2018’s robust gain of 2.68 million, and ranked 2019 eighth for job growth in the past 10 years. A cooler pace of hiring in part reflected global economic uncertainty and the fading effects of tax cuts that took effect in 2018, both of which reversed in the last months of the year. Nevertheless, employers added new positions for a record 10th straight year.
And for the decade, the United States added 22.6 million jobs, a dramatic turnaround from the 2000s, when the economy shed nearly 1 million. Admittedly, those numbers are skewed somewhat by the jobs blowout of the Great Recession in 2008-09, when unemployment grew to 10.2% in the last several weeks of that decade, erasing jobs gains from the early and mid-2000s.
So how can we keep adding jobs while the unemployment rate holds steady at 3.5%? Employers are adding jobs despite low unemployment by pulling workers off the sidelines, including women, Hispanics, African-Americans and those with lower levels of education that have historically faced barriers to employment.
But another statistic resulted in a labor milestone: women overtook men to hold the majority of U.S. jobs for the first time in a decade. The number of women on nonfarm payrolls exceeded men in December for the first time since mid-2010, as women held 50.04% of jobs in December, surpassing men on payrolls by 109,000.
The gap between male and female employment had been narrowing in recent years, reflecting growth in services industries that employ higher numbers of women, especially the booming health-care field. The last time women outnumbered men on the jobs front was from a stretch in 2009 and 2010, when men lost construction and manufacturing jobs in amounts disproportionate to the total employment picture.
All of this points to a growing and dynamic economy heading into 2020 and the decade beyond. With a job market this robust, we can expect the economy to continue to expand, and for the aggregates industry to expand alongside our nation’s economic progress.
Pierre G. Villere serves as president and senior managing partner of Allen-Villere Partners, an investment banking firm with a national practice in the construction materials industry that specializes in mergers and acquisitions. He has a career spanning almost five decades, and volunteers his time to educate the industry as a regular columnist in publications and through presentations at numerous industry events. Contact Pierre via email at [email protected]. Follow him on Twitter @allenvillere.