Capitol Hill Weekly Roundup: A Look at Labor
As President Joe Biden continues to offer hints of seeking another term in 2024, he continues to tout economic numbers like the March jobs report that showed the addition of 236,000 jobs in the United States.
This is a good jobs report for hard-working Americans,” Biden said in a statement, noting that the unemployment rate was 3.5 percent.
“My economic agenda has powered a historic economic recovery. We’ve created 12.6 million jobs since I took office,” Biden said. “The unemployment rate is close to the lowest it has been in more than 50 years and a record low for African Americans.
“Thanks to the policies we have put in place, the recovery is creating good jobs that you can raise a family on, which is pulling more Americans into the labor force,” Biden added. “In fact, the share of working-age Americans in the labor force is at a 15-year high.”
The Bureau of Labor Statistics (BLS), which produces the jobs report, indicated that the number of long-term unemployed (defined as those jobless for 27 weeks or more) was 1.1 million in March. That number accounts for 18.9 percent of all unemployed Americans.
The labor force participation rate trended up in March at 62.6 percent.
The number of people not in the labor force who currently want a job was 4.9 million in March.
Leisure and hospitality saw an addition of 72,000 jobs in March.
The BLS report indicated that the U.S. economy and the job market remain solid even amid nine consecutive rate hikes by the Fed since last year to fight escalating inflation. Helped by drops in gasoline and grocery prices, inflation slowed for a ninth straight month in March, according to the Labor Department Consumer Price Index.
Overall, consumer prices increased 5 percent from the previous year, down from 6 percent in February and a 40-year high of 9.1 percent last June, the CPI showed.
What do all the numbers mean for the hotel industry? Inflation remains high, and a staffing shortage continues to impact hotels across the country.
“We need 1,200 new employees in San Francisco, and we need them now,” Lynn Mohrfeld, CEO of the California Hotel & Lodging Association, said at a news conference at the Hyatt Regency San Francisco.
The American Hotel & Lodging Association’s (AHLA) 2023 State of the Hotel Industry Report indicates that the hotel industry is projected in 2023 to surpass pre-pandemic levels of demand.
Operational challenges like staffing shortages and economic factors will replace COVID as hotel operators’ top concerns, according to the report, which is based on data and analysis from Oxford Economics.
“Three years after the unprecedented hardships our industry faced due to the pandemic, hotels continue to make significant strides toward recovery,” said AHLA President & CEO Chip Rogers said in a statement. “2022 saw one of the strongest summer travel seasons ever, and this year we expect hotels to reach new heights in terms of room revenue, room-night demand, and state and local tax revenue.
“But when inflation is taken into account, our industry likely won’t see full recovery for several more years,” Rogers added. “Nevertheless, hotel performance is trending in the right direction – great news for our industry and our employees, who are enjoying better pay, more career opportunities, upward mobility, and flexibility than ever before.”
According to the report, hotels are projected to employ about 2.1 million people in 2023. This represents a 7.4 percent increase from 2022 but is 260,000 below 2019 workforce numbers.
According to Federal Reserve guidelines, 2 percent is the sweet spot for inflation.
In a March press conference, Federal Reserve Chairman Jerome H. Powell said, “We will get inflation down to 2 percent, over time.”
On its website, the Federal Reserve said that “The Federal Open Market Committee (FOMC) judges that inflation of 2 percent over the longer run, as measured by the annual change in the price index for personal consumption expenditures, is most consistent with the Federal Reserve’s mandate for maximum employment and price stability.
“When households and businesses can reasonably expect inflation to remain low and stable, they are able to make sound decisions regarding saving, borrowing, and investment, which contributes to a well-functioning economy.”
