For workers, this economy could be as good as it gets

Despite falling unemployment, the 2017 economy appears to be leaving a growing number of workers behind.

Take for instance the gap between official joblessness and a much broader rate that includes people who have stopped looking for a job but say they still want one, along with part-time workers who want full-time jobs. Today this broader jobless rate is 8.4%, almost double the official 4.3%. The last time the official rate was this low, in 2001, the broader rate was almost a point lower.

Why it matters: A greater share of Americans are cut off from the work force today than in prior periods of low official unemployment.

In a research note to clients this week, Jim O'Sullivan of High Frequency Economics predicted that the main jobless rate will fall below 4% by the end of next year, which would be the lowest since December 2000. But he also noted that, according to recent survey data, business owners report a harder time finding qualified candidates for their job openings. That means that broader unemployment could remain stubbornly high.

Why aren't wages rising faster? Salaries began to rise faster in recent months, according to government data, but the movement should be greater when considering how low unemployment is. Economists expect wage growth to accelerate as joblessness continues to fall. But even if this occurs, it will be cold comfort to chronically jobless and underemployed on the fringes of the labor market.

Rising delinquencies: The struggles of poorer Americans can also be seen in the rise in subprime auto loan delinquencies in recent months, which are now well above pre-recession norms.

Then there is the Fed: Markets expect the Federal Reserve to raise interest interests rates at its meeting next week, and economic history shows that when the Fed starts hiking rates, recessions often follow, which, if one occurs, will be another blow to workers.