Over the past month, unemployment levels in Wisconsin hit record lows, dropping to 2.8% in March.
The Center of Wisconsin Strategy’s associate director Laura Dresser said that the numbers are far lower than they’ve been in recent memory — the
Dresser said that unemployment is defined by the number of unemployed people who self-report that they are actively seeking a job.
The United States Department of Labor found that the national unemployment rate in March of this year was 3.6% in March. Dresser said that the Wisconsin unemployment rate is usually a little lower than the national rate, a trend that began in the 1990s and has continued since.
“We are now at a point where more people are leaving the force than entering it,” Dresser said. “More people are aging out and retiring than are aging into the workforce.”
Dresser added that the state’s low number of immigrants adds to a greater demand for workers. She said this is because immigrants are usually a young population, and young populations tend to have higher unemployment rates.
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Dresser said that the demand for workers started pre-pandemic.
“Unemployment is declining right now because the economy is healing and moving into a new normal,” Dresser said. “In March of 2020, we lost an enormous number of jobs, and we’ve been pulling up from that unevenly from the summer of 2020.”
Soon-to-be UW graduate and food science major Kaitlyn Younger said she found success on the job hunt this spring, snagging a job in her field in California after roughly a month and half of active job search. Though job hunting is stressful, Younger said she was able to find something that she’s excited to start.
Dresser added that a lot of the demand was carried over from the labor shortage that began early last year. An article from CNN said that the labor shortage is caused in part by people leaving their jobs to find new ones, leaving positions open in nearly all industries.
According to Dresser, empty positions caused by the shortage have created a massive demand for workers.
“More employers are figuring out where demand is and they’re hiring workers to replace those lost jobs,” Dresser said.
With the newest round of UW students graduating, some students wonder whether or not the demand for workers will improve prospects for recent graduates, or at least make the job search easier, according to the Bureau of Labor Statistics.
Younger said she recieved three job offers throughout the process, but eventually landed on one she’s excited about.
“I felt like since I started second semester I felt more pressure to take something I knew I didn’t want because I was scared of not having anything, but there was still tons of jobs on the market so I just had to be paitient,” Younger said.
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Dresser said she does not have a prediction as to whether greater demand for workers will affect college students and recent graduates.
“We just don’t know how this will play out,” Dresser said.
According to Forbes, recent college graduates have a lower unemployment rate than those with just a high school diploma or a GED equivalent. They reported that, in November of 2020, the unemployment rate for college graduates aged 25 and older was 4.1%, where the rate for those with only a high school diploma in the same age range in the same month was 7.4%.
Elias Schwalbe, who recently graduated with a degree in Economics and Consumer Retail Behavior, said he’s not surprised by the difference in unemployment rates.
“Many employers seem to think that college degrees inherently make people more hirable, even when they may have less experience in that particular field,” Schwalbe said, “and even with the current labor shortage many employers still want what positions they have open to be filled by college graduates.”
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Dresser said in Madison, unemployment rates are even lower than those in the state as a whole, possibly creating more opportunities for recent graduates who choose to stay in Madison.
“There is growth in the workforce. More people coming here for jobs, with Epic being a notable contributor,” Dresser said. “Dane County is adding jobs, and people are coming to fill those jobs. There’s just more opportunity here.”
Dresser said that these low unemployment numbers appear to be here to stay unless there is an economic downturn.
She said that short of some sort of shock to the economy, we can expect numbers to stay relatively stable.
“It will never reach zero because people will continue to shift jobs,” she said, “something such as another COVID-19 lockdown or a change in federal policies could bring levels back up, but there’s no indication that things will go suddenly downhill.”
There is enough demand for workers that we don’t have to worry about unemployment levels drastically rising in the near future, according to Dresser.
She said that the lack of workers continues to fuel demand and that companies will continue to seek workers.
“The economy is adding jobs, and workers are moving into those new jobs,” she said. “When the demand for workers goes up, unemployment goes down, and the demand for workers is currently very high.”