Even with Hiring Spree U.S. Inflation Remains Low

Even with Hiring Spree U.S. Inflation Remains Low For the last few months the rate of hiring in the United States has seen a continuous growth with an obvious drop in the rate of unemployment. Relatively there is supposed to be times when the pay structure and inflation are expected to get begin increase as a result. However it is not really happening.

In December the employers added a huge 252,000 jobs which made the month the very best in hiring since 1999. The unemployment rate sank to5.6% from 5.8%. However, the rate of inflation is not being able to manage reaching the two percent target rate of the Federal Reserve. The paychecks are also not moving with great enthusiasm. In fact in December the average hourly wages also fell.

Even the economists are finding it difficult to explain the incident. Patrick O'Keefe, chief economist at consulting firm CohnReznick said,"I cannot come across a plausible empirical or theoretical explanation for why hourly wages would drop when for nine months we've been adding jobs at a robust pace."

As per some government report, last time in 1999, when the U. S. economy had enjoyed a comparable hiring spree, the average wages had increased by 3.6 %, as compared to the 1.6 percent this year.