- by New Deal democrat
Unsurprisingly, my focus on this report, like the last few reports, was on whether residential construction jobs turned negative or not, whether manufacturing and temporary jobs continued on their downward trajectory, and whether the deceleration in job growth would be apparent.
Some of the deceleration or decline occurred, particularly in the sectors which lead the market overall, while other metrics held steady or even improved, consistent with a still very tight market.
Here’s my in depth synopsis.
Leading employment indicators of a slowdown or recession
These are leading sectors for the economy overall, and help us gauge how much the post-pandemic employment boom is shading towards a downturn. These were mixed, but the overall tenor was neutral to negative:
Wages of non-managerial workers
Aggregate hours and wages:
Other significant data:
As it is so often, this report had a somewhat bifurcated nature. It remained solid in terms of absolute job growth. Further, in general the numbers derived from the Household Survey were very good. But most of the leading internals in the Establishment report were negative.
Let me highlight the leading negatives. All 3 leading sectors of the jobs market have turned down: manufacturing, construction, and temporary jobs. Also, while the manufacturing workweek was unchanged this month, it is at a level which in the past has been consistent with a recession. The drumbeat of negative revisions to prior reports has also resumed. This is solidly pre-recessionary.
But let’s not overlook the positives in the Household Survey. Both the unemployment and underemployment rates declined, and participation increased. Jobs are obviously still easy to get, as those out of the labor force who nevertheless want a job declined to a 3+ year low, and indeed except for 2019, the lowest number since 2008. And while aggregate payroll growth is decelerating, it is still growing at a rate higher than inflation.
To sum up: pre-recessionary, but we aren’t at the recession yet.