What the Economic Upturn Means for Your Industry
We’ve been hearing for a long time that the economy has been improving since the Great Recession hit. And it has been—but painfully slowly, and for most workers that improvement has been hard to see. As we move into 2015, however, there are signs that the strengthening economy may finally start to benefit people more widely.
We look at some of the important ways that the economy is getting better, and how that may affect your industry.
All Industries: Unemployment Rate
Unemployment continues to fall across the economy. The unemployment rate in December was just 5.6%, according to the Bureau of Labor Statistics. In December 2013 it was 6.7%, and five years before it was 9.3%.
With lower unemployment, more people have jobs and more money to spend, which helps the whole economy. Also, there are less workers available to fill job openings, leading to competition for the best workers. More competition is “the current reality, and it is not likely to change in the next 12 months,” says recruitment advisor Chuck Smith.
In addition, 14 states raised their minimum wage in 2014, and in many states the minimum wage will go up with inflation. That means better pay, and more money to spend, for the lowest-paid workers in the economy.
Construction: Rising House Prices
The National Association of Realtors reported the median house price for existing homes was $208,500, up 5.8% from last year—the highest it’s been since the recession. (The median is house price is literally the middle price; half of all houses are worth less, and half are worth more.) And “housing inventory”—the number of homes for sale—is down 11%.
What does all this mean? Higher prices and lower housing inventory mean there’s demand for homes, and that means more homes will be built. That means a stronger construction industry. Construction has struggled for years now, so that can only be a good thing.
Retail: Gas Prices
You probably already know gas prices are down. The average price for unleaded gas was $2.56 per gallon in December, down from $3.28 at the same time last year.
While that’s made life a bit tougher in states like Texas and Alaska, which depend heavily on oil, across most of the economy it’s meant people have more money to spend. While retail sales suggest people may be saving that extra money at the moment, in the long run it should be good for retail.
Manufacturing: Manufacturing Growth
Manufacturing also looks strong, and has now been growing for 19 months in a row. And new orders, production, and manufacturing employment are all up. That’s a big deal, since the US manufacturing sector is bigger than the economies of Italy or Russia.
That doesn’t necessarily mean more of the classic assembly-line jobs we often associate with manufacturing. Skilled production workers (such as machinists and technicians) as well as project managers are more in demand than ever, with shortages in highly-skilled manufacturing positions.
In short, the improving economy is likely to benefit most people, but the more in-demand your skills are, the more you’ll stand to benefit as competition for workers heats up. To sharpen your skills, check out the courses available on campus or online.