The U.S. job market is on the mend

Sources: Bloomberg and Wells Fargo Investment Institute. Monthly data from January 1, 2006 to September 30, 2021. JOLTS: monthly data from January 1, 2006 to July 31, 2021. JOLTS = Job Openings and Labor Turnover Survey. Shaded area represents a U.S. economic recession. SA = seasonally adjusted.

Key Takeaways

  • Job openings exceed unemployment by over 2 million people, highlighting labor shortages restraining growth. Our view is that job gains will get an added lift from economic growth led by labor-intensive services industries.
  • We expect strong job gains supported by strong economic growth and moderating labor shortages to lower the unemployment rate by more than two percentage points by the fourth quarter of 2021, compared to a year ago.