Americans Been Job Hopping for Higher Salary: Fed Watching as Massive, Stimulus, Tax Cuts & Spending Cuts Loom

The Resistance Reports

March 16, 2017

At Trump’s Congressional address, Trump talked down the American economy. But by most accounts, meaning a large number of Americans still poor, the American economy is doing great. Even Trump, is now admitting the American economy is strong, but of course, being Trump, he said it is because of him.

But while Trump’s politics pumps a great deal of fake news into the American society, such as the American job report was being edited by Obama to look good, as Trump does that, much of Americans themselves, have noticed the good economy under Obama to the level that job hopping, for better salary, have been going on for a few years now.

For example, a poll found nearly 3,300 jobholders across the country, found that 21 percent of respondents are looking to find a different place of employment in the new year. That’s a 5 percentage point increase from a similar survey conducted at the end of 2014. Also a new survey released Monday by employment site CareerBuilder estimates that more than one in five employees are determined to leave their current place of employment at some point during 2016.

So with economy going strong and workers back to job hopping, Trump is putting into the equation, a “Massive” stimulus, tax & spending cut.

Not much of that is actually working itself into the economy as yet, except for investments in markets in anticipation. But inflation could become a bigger problem as job hopping heats up inflation and the Fed is already upping interest rate to head-off and kill inflation.

The stimulus is massive, i.e. in infrastructure, Mexican Wall and military spending, coupled with a massive tax cut for corporations, along with an America first policy, that sees Trump doing anything, such as threatening corporations to invest in & move to America.

This situation would hurt the balances, if the stimulus and tax cut, does not push growth to a higher enough level, but if push too much, inflation spikes likely. Sp there are risks here, and in other places, such as trade & currency wars risks.

And the risk goes up even more, as Trump & GOP, already criticized and al with protest, for their continuous attack on humanitarian issues, such as immigrants & immigration, which brings economic and business risk of their own to the picture, and future massive spending cuts in social safety nets & government services, means a very messy future American politics that can zap America’s growth prospect.

Meanwhile, even the Fed is watching the “Job Hopping Situation” according to a Bloomberg report (source) https://www.bloomberg.com/news/articles/2017-02-27/fed-turns-to-job-hoppers-as-1950s-inflation-guide-shows-its-age

Adrienne Heintz, an Atlanta marketing professional, has discovered a reliable way to earn higher wages, and Federal Reserve economists are taking note.

The Auburn University alumnus changed jobs twice in the past two years and nabbed raises of 10 percent and 8 percent as a result. “Switching positions internally or externally is definitely the fastest way to a larger salary,” according to Heintz, who is 28.

She isn’t alone in her approach, as a growing number of Americans are changing employers in search of more money. That trend is attracting the attention of labor economists, who are increasingly studying how job-hopping Americans drive compensation gains. The new focus comes at a time when the long-held theory that the unemployment rate can help forecast moves in wages and inflation is coming under scrutiny.

On job hopping US News & World Reports, reports (source) https://www.usnews.com/news/articles/2015-12-28/2016-could-be-the-year-of-the-job-hopper employers shouldn’t get too attached to their workers over the course of the next year.

The report, which and could spell trouble for management teams that want to retain talent, considering about 30 percent of young workers between 18 and 34 years old plan on having a new job by the end of 2016.

“Just because a person is satisfied with their job doesn’t necessarily mean they aren’t looking for new work,” Rosemary Haefner, chief human resources officer at CareerBuilder, said in a statement accompanying the report.

Indeed, about 34 percent of respondents said they are “regularly searching for job opportunities, even though they’re currently employed,” according to the statement. But that finding sits at the low end of the spectrum. A separate report published earlier this year by employment and research site Indeed estimated about 58 percent of U.S. adults look around at least monthly for alternative employment opportunities. And another study issued last month by Gallup polling group found that about 51 percent of current employees are looking for a new job in some capacity.

The following is from Bloomberg (source) https://www.bloomberg.com/view/articles/2017-02-21/how-the-fed-s-rate-hikes-might-play-out

The U.S. economy is poised to deliver on the Federal Reserve’s economic forecast for this year. That means a baseline outlook for three interest-rate increases remains in play — though not the way market may be anticipating. Think of it as two rate hikes, one each in June and December, with an option for a third in September.

The data continue to be generally supportive of the economic forecasts outlined in the Fed’s December Summary of Economic Projections. The first employment report of the year set the stage with a solid jobs gain but an uptick in unemployment. The latter indicates that there remains slack in the labor market, and Fed Chair Janet Yellen would like to let the economy run strong enough to squeeze it out.

Surveys of manufacturing and nonmanufacturing activity also point toward firming activity. In addition, housing starts and permits remained strong in January as December numbers were revised higher. Starts are 10.5 percent above year-ago levels. Housing appears likely to remain resilient given the uptick in mortgage rates experienced late last year as steady jobs growth and rising wages provide underlying support.

Inflation numbers firmed in January, with the core consumer price index gaining 0.3 percent for the month and 2.3 percent from a year earlier. This bodes well for the Fed’s inflation forecast for the year. Moreover, the recent decline in the value of the dollar should help support a move higher in the Fed’s preferred inflation measure toward the 2 percent target.

Altogether, the economy seems to be tracking at a fairly brisk pace. The Atlanta Fed is looking at 2.4 percent annualized growth for the first quarter of 2017, and the New York Fed is at 3.1 percent. Both exceed the Fed’s estimates of potential growth and should push unemployment a bit below the natural rate and inflation up to target per the central bank’s forecast.

So, that begs the question: Is the Fed falling behind the curve on inflation? Not yet. The upward pressure in headline inflation is likely coming to a close. Oil prices reached a low in January 2016, so the base effects are now waning and will continue to do so as long as oil is generally tracking sideways. Similarly, the dollar is now about flat from year-ago levels. Absent further declines it will cease to place upward pressure on inflation and, in the future, favorable year-over-year comparisons suggests some modest downward pressure:

 

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