- Michelle Girard, chief U.S. economist for RBS
Friday's producer prices and consumer sentiment both surprised markets to the downside, suggesting both inflation and consumer spending will still be lagging in the coming weeks or even months. Nevertheless, the Fed has been surprisingly confident about the economy, citing significant pickup in the labour market, but is it really so strong for the central bank to withdrawn its QE?
The number of jobless claims and jobs created showed the strength of the U.S. labour market; however the thing the BLS does not say about is the number of multiple jobholders in the United States. Currently, around 4.5% of the labour market is represented by multiple jobholders, including 2.4% of which are holding part time job in addition to a full-time position. The main reason behind searching for the second job is a will to have extra income, while almost 30% of people simply needed additional earning to meet their regular expenses.
Since the beginning of the recession the number of multiple jobholding has been decreasing; however, with more ageing population and the implementation of the Affordable Care Act or the so-called Obamacare, more people will have to switch to several part-time jobs. With such perspectives, economy's ability to create jobs, especially part-time, will be one of the determining factors for a long-term prosperity.
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