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The 2-minute drill

Those ‘help wanted’ signs aren’t helping to pull people into the Mass. job market

Employers are adding jobs at a healthy clip, but the labor pool continues to get smaller.

The Massachusetts labor force has not rebounded to its pre-COVID level, leaving employers scrambling to find enough workers.Nam Y. Huh/Associated Press

Massachusetts doesn’t have a problem creating jobs. There just aren’t enough people willing or qualified to fill them.

Local employers added more than 17,000 jobs in November, according to US Labor Department data released on Friday by the Baker administration. That’s about four times the average monthly gain in 2019, before COVID-19 hit.

But the pool of available workers keeps getting smaller. The number of adults 16 or older with a job or looking for one, known as the labor force, declined by more than 13,000 last month, the latest data show.

That drove a dip in the state’s unemployment rate to 3.4 percent in November from 3.5 percent in the prior month. The national rate was 3.7 percent.


Any single month of employment data reveals only so much, especially at the state level, where the numbers tend to be revised significantly.

But the trends this year are clear: Massachusetts employers have added nearly 130,000 jobs even as the labor force has shrunk by almost 19,000.

There were two jobs open in the state for every unemployed worker in October, the most recent month for which the data are available. In November, the labor force participation rate dropped by 0.2 of a percentage point to 65.3 percent. That’s the lowest since March 2021 and compares with the most-recent peak of 67.1 percent in 2019.

Economists point to a grab bag of reasons why there are fewer available workers, including a decline in immigration, increased retirements among workers age 70 and older, a shortage of affordable child care, and COVID deaths and lingering health concerns.

What’s hard to nail down is why the participation rate among men in their prime working years — 25 to 54 — remains below that recorded before the pandemic, while the rate for women has more than fully recovered.


Whatever the causes, the mismatch between demand for workers and supply has so far been good for workers because employers are raising wages to fill open jobs. But that’s not good if an upward pay spiral pushes inflation higher, as employers pass along higher labor costs to consumers in the form of higher prices for goods and services.

The Federal Reserve is seeking to curb labor demand — and by extension, inflation — by sharply boosting interest rates, which makes it more expensive for businesses to use borrowed money to expand. With fewer job openings, and unemployment increasing, wage increases should moderate. So should consumer spending, as families tighten their belts.

It’s a painful way to rein in inflation, and could trigger a recession rather than the milder slowdown the Fed is aiming for.

The central bank could still pull off its desired “soft landing.” But eventually, the country needs to figure out how to expand the labor force.

Larry Edelman can be reached at Follow him @GlobeNewsEd.