Employment growth should decelerate more quickly as employers reduce hiring against a backdrop of a slowing economy and declining corporate profits.Economist Nancy Vanden Houten, Oxford Economics, on the job market. Friday’s job report showed 263,000 jobs created and an unemployment rate of 3.5%.
Why It Matters: The American economy created jobs last month (a positive), just not as many as economist expected (a negative). The unemployment rate dropped from 3.7% to 3.5% in part because the labor force declined – a sign fewer people are actively searching for work (also a negative). As we’ve covered other signs of a potentially slowing economy, this raises some concerns about the U.S labor market. We’ll need to watch whether this is a one-off report or part of a larger trend.
For context to understand the slowing of the job market: “Payrolls grew by an average of more than 440,000 a month during the first half of 2022.”
by Jenna Lee,