Live

Watch CBSN Live

Workers find new bargaining power in a strong jobs market

Workers have leverage in strong job market

The United States labor market is as strong as ever: A near-record low 3.6% of Americans are unemployed -- giving workers an edge in negotiations with their employers. 

The economy added more than 250,000 jobs in April and nearly 200,0000 jobs in March. That has restaurants, manufacturers and other businesses across the country reporting difficulties recruiting and retaining workers who find themselves in a position to seek more pay, ask for better benefits perhaps gain increased flexibility on the job. 

"We've been on a tear, really, uninterrupted since the end of the recession," NPR's Chief Economics Correspondent Scott Horsley told CBSN. 

U.S. employers added 263,000 jobs in April

Horsley gave the example of Kohler Co. which in 2010, in response to the Great Recession, imposed a two-tiered pay-scale system on employees, paying those hired after 2010 lower wages compared to longer-tenured workers performing the same tasks for the company, best known for its bathroom and kitchen fixtures. 

Newer workers' pay only began to rebound in 2016 following a worker strike the year before. Kohler found itself unable to fill jobs in a booming economy and ultimately agreed to a contract that phases out the two-tiered wage scale by 2023, NPR reported

"It's definitely the case that if you have a job, if you're looking for a job, this is a good time to be trying to flex your muscle a little bit and say, 'Hey, I probably deserve a little bit more pay,'" Horsley said. 

So-called gig economy workers, including Uber and Lyft drivers, however, don't have the same kind of leverage. "They often don't have benefits, they don't have the same kind of security that you would have if you were working for an employer," Horsley explained. 

The rate of unemployment is even lower in cities like Ames, Iowa, where the unemployment rate is just 1.5%. "There are lots of jobs there, lots of employers are looking for workers, and there are just not a lot of people moving to Iowa, to cities like Ames, so it's a real challenge for employers in those places," he said. 

Trump-supporting counties enjoy the fastest job growth, but wages lag

The jobs market is expected to be a hot topic for discussion in the runup to the 2020 presidential election, Horsely predicted.

"There's no question Donald Trump will be campaigning on a strong economy, on low unemployment, and wages that are finally starting to grow at a pace faster than inflation," Horsely said. 

Democrats, meanwhile, will also claim responsibility for jobs growth that has been chugging away since the recovery started in late 2009. 

"Democrats will try to frame this as the continuation of the Obama economy and in fact, if you just draw a straight line back to the recession and the recovery, there is no clear inflection point in 2016 or 2017 when Trump came into office. We are pretty much on the steady path we've been on since the previous president," Horsely said.

View CBS News In