I know we are "technically" in a recession based off of 2 negative gdp prints, along with gas prices decreasing for the 51st straight day due to the combination of higher interest rates and massively lower demand.
On the other hand, in July, payrolls came in at 528k vs. 258k expected as the labor force participation rate fell to 62.1..
What are peoples thoughts on this?
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Nah, employment is low.
The irony of this is astounding.
Yeah, more people are working more than one job now than ever...
We don’t say the “R” word anymore
Despite what Karl Marx disciples will have you believe unemployment has nothing to do with whether or not we are in a recession as by that logic the panacea to recessions is cutting labor force participation. AD (my 8 years of now pointless econ education coming out) has fallen 2Q in a row, recession full stop.
The Soviet Union had full employment...
And a generally weak economy...
Joe? Is this you?
Bruh let's please just get inflation down and get the Dems out of office come midterms
Workforce particpation rate has declined for the last two months, so that that "job growth" is people taking on multiple jobs because things are getting that rough out there. We are definitely in a recession and those with both eyes wide open are paying attention to if this turns into a full on depression. When they have to go back and try and redefine the word recession, you know they're full of it and are trying to hide the truth.
I don’t think you understand the labor force participation statistic. It counts both employed people and unemployed people looking for jobs as participating in the labor force.
So it is entirely possible for a strong jobs report to happen alongside a slight decrease in the labor force participation rate without people working extra jobs. You could have a lot of people getting hired but also many people retiring the same month.
And you're only counted in either of those categories if you're either working or unemployed and looking to be employed. If you're in the age criteria, but not looking to work or are institionalized, you're excluded. So your idea of people retiring means the potential workforce pool shrinks. And if people are continuing the "great resignation" and not wanting to work anymore, the workforce shrinks again. To grow the workforce pool and thus increase the rate it'd take new people coming of age and wanting to find a new job or say a stay at home mom wanting to get back into the office.
Also, there's the simple fact that it's measured that we added 263k multiple job holders in June. Which is almost half of that "jobs gain".
But hey, I obviously don't understand WTF I'm talking about or how to use this thing called FRED...Or we can just shrug shoulders and call it "seasonal adjustments" to make GeorgeSorosFinanceMaster feel better.
It is a pacipatory number. There is only one way you can have a falling LPR and a growth in the gross number of people working, otherwise you can not have an increase in the gross number of people working if you have a falling LPR. The only way to have both is to have a population that is rising significantly faster than the LPR is dropping. Which in America is not really the case.
Not even just the participation. The majority of that "job growth" is measured from the literal trough of covid when people were not allowed to go to work. Letting people go back to work isn't growth, it's mean reversion. This has been a decline fought off by the Fed's money printer and now the effects of that are starting to settle in. Buckle up.
On point, if we measured from pre shutdown we are still far behind. Getting back to baseline isn’t really any growth.
Uncle Joe says “NO WAY, Jack!”
Anecdotally, July was an extremely strong month for two of our three consumer brands. Was avg for the other one. May and June were much weaker, guessing things bounce back as gas keeps dropping.
Also, still very tough to hire blue collar labor. Both skilled & unskilled.
Yeah the companies I cover (pretty much all consumer discretionary) all reporting strong numbers. Feels like there's some impending weakness in 2H but even so does not feel like anything catastrophic. I hope we can get the inflation numbers down before rates have to rise >4%, been a brutal enough time in markets already with consensus pricing in 3.5%
Recession is transitory
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