Last week: The positive momentum in the employment market is worthy of respect

The Monthly Job Report is Rodney Dangerfield in Economic Statistics. It’s hardly respected, but it has a large and important audience.

At good times, employment data is ridiculed as a “lagging indicator.” It should be rejected, especially by the stock market, just because it captures what the employment market was. At bad times, job information confirms difficult times or is rejected as out of date.

Job reports in May show that Americans continue to find jobs and US companies continue to open new positions, but they can still be discounted. The stock market is in a bad mood. We are confident that the fight against inflation in the Federal Reserve will not only slow the economy, but also cause a recession.

“The 2022 recession is not my basic case,” Raphael Bostic, president of the Federal Reserve Bank of Atlanta, told me last week. “There is a lot of momentum in today’s economy,” he pointed out as evidence of the job market.

Over the past year, over 500,000 jobs have been created each month. This is three times the average monthly charge for the previous year for COVID-19. At the same time after the Great Recession, the employment market was weakening. The average monthly number of new employees was 160,000.

“By any standard, it’s an incredibly powerful and powerful economy moving forward,” Bostic said.

The May report will be released last Friday. Even the slowdown in employment represents a still booming employment market.

Not all the work lost in the early weeks of the pandemic could be regained. It will come sometime this summer. And rising unemployment may not be a sign of an impending recession warning, but a sign of relieving pressure on difficult labor market conditions.

Employment data strengthens the Federal Reserve’s efforts to reduce inflation by raising target short-term interest rates. And that strategy will be respected as long as the job market continues to grow.

Tom hudson

Financial journalist Tom Hudson hosts the “Sunshine Economy” at WLRN-FM in Miami and is Vice President of News. He is a former co-anchor and editor-in-chief of the Nightly Business Report on public television. Follow him on Twitter @ HudsonsView.

Last week: The positive momentum in the employment market is worthy of respect

Source link Last week: The positive momentum in the employment market is worthy of respect

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