By Harguan Kaur
If you’re anything like me, you’re probably looking for a summer job, cause some extra money wouldn’t hurt. But if your inbox has been filled with “We are sorry to inform you,” emails, I am here to assure you that it is not your fault.
Currently, the latest unemployment figure is 3.7%, which is below the target NAIRU (Non-Accelerating Inflation Rate of Unemployment). What on earth is that? Well NAIRU essentially refers to the rate of unemployment which is still low, but not too low to increase inflation. The current target for NAIRU is 4-4.5% (4.25% to be exact.)
So, how are we so much lower than the target? Like the answer for many economic questions it is due to COVID-19. The post lockdown boom allowed for many more people to be employed as there were many open jobs. This drove down our unemployment rate, which is good for economic growth, but it is bad for inflation if the rate gets too low.
And now, the unemployment rate is very low and inflation still remains high at 5.4% (annual CPI figure).
This means we currently have a tight labor market, essentially meaning it is significantly harder to enter the workforce. Especially near Christmas, demand for workers is very high but there aren’t enough workers. This means that more skilled workers (not us teenagers) are more likely to get hired before us.
So, don’t worry guys, keep looking, eventually they will hire us! And just remember it’s not you, it’s the labour market.