>
Article snippet: Automobile sales may be slowing, e-commerce is putting the squeeze on bricks-and-mortar stores, and overall economic growth is limp. But the labor market has nevertheless managed to charge ahead. Employers added an impressive 222,000 jobs in June, the government reported on Friday. Although the jobless rate ticked up slightly to 4.4 percent, it was because some people who had dropped out of the labor force were lured back. But the hunger for workers and mounting complaints of labor shortages have raised a vexing question: Why isn’t the heightened demand for workers driving up pay? The Federal Reserve pointed to that conundrum in the updated report on the American economy it sent to Congress on Friday. “Despite the broad-based strength in measures of employment,” it said, “wage growth has been only modest, possibly held down by the weak pace of productivity growth in recent years.” The Fed’s report reflected its overall confidence in the country’s economic direction, which has led it to begin raising interest rates for businesses and consumers after years of holding them near zero to encourage investment and risk-taking. After increasing its benchmark rate last month, the Fed is expected to do so at least once more before the year’s end. One of its aims is to head off any inflation that might result from a tight job market that prompts employers to offer higher pay to get the workers they need. Yet prices have been rising at a slow pace, and sluggish wage growth s... Link to the full article to read more