The Bureau of Labor Statistics regularly releases snapshots of the unemployment rate, giving insights into the labor market at different times. However, annual data provides a more comprehensive overview of the labor market over an entire year. The annual Work Experience of the Population report, which presents this year-long viewpoint, has recently released the data for 2022.

According to Heidi Shierholz at the Economic Policy Institute, 2022 exemplified low unemployment, with rates averaging around 3.6% per month. When considering the whole year, however, the unemployment rate was found to be 7.6%. This rate indicates that twice as many people experienced unemployment at some point during the year than the average monthly unemployment rate suggested. The figure of 7.6% is historically the lowest in the data, which began in 1958.

Significantly, this low rate happened during the great resignation, a period characterized by numerous job changes among American workers. Many employees were quitting their jobs and finding new ones without experiencing gaps in employment or pay. According to Erica Groshen, senior economics adviser at the Cornell School of Industrial and Labor Relations, this suggests an efficient labor market where people were finding suitable matches.

This strong labor market was observed across nearly every demographic, with the Center for American Progress’s David Madland noting its beneficial effects for women, men, young people, and older workers. Even with some slowing in early 2023, workers maintained leverage, as employers needed to offer competitive compensation to recruit and retain workers.

The confidence of the job market has also sparked renewed vigor in organized labor, with workers becoming less fearful of the repercussions of strikes and organizing efforts.