{"id":1628988,"date":"2022-09-01T06:48:20","date_gmt":"2022-09-01T10:48:20","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1628988"},"modified":"2022-09-01T06:49:03","modified_gmt":"2022-09-01T10:49:03","slug":"has-the-jobs-market-decelerated-towards-recession","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/has-the-jobs-market-decelerated-towards-recession\/","title":{"rendered":"Has the Jobs Market \u201cDecelerated\u201d Towards Recession?"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"float:left\"><div class=\"counts mashsbcount\">14<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fhas-the-jobs-market-decelerated-towards-recession%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1628988&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><div><\/div>\n<p>It\u2019s\u00a0<em>baaaa-aaaaack<\/em> \u2026 and <a href=\"https:\/\/adpemploymentreport.com\/\" target=\"_blank\" rel=\"noopener\">it\u2019s bad<\/a>. ADP took the summer off to retool its monthly National Employment Report, thanks to a consistently non-predictive result when compared to the official jobs reports from the Bureau of Labor Statistics. Its new report, now in partnership with the Stanford Digital Economy Lab, predicts that <a href=\"https:\/\/www.cnbc.com\/2022\/08\/31\/adp-jobs-report-private-payrolls-grew-by-just-132000-in-august.html\" target=\"_blank\" rel=\"noopener\">job growth in August will miss expectations<\/a> \u2014 by a lot:<\/p>\n<blockquote>\n<p>Companies sharply slowed the pace of hiring in August amid growing fears of an economic slowdown, according to payroll processing company ADP.<\/p>\n<p>Private payrolls grew by just 132,000 for the month, a deceleration from the 270,000 gain in July, the firm said in its monthly payroll report.<\/p>\n<p>The Dow Jones estimate for the ADP count was 300,000.<\/p>\n<p>\u201cOur data suggests a shift toward a more conservative pace of hiring, possibly as companies try to decipher the economy\u2019s conflicting signals,\u201d said ADP chief economist Nela Richardson. \u201cWe could be at an inflection point, from super-charged job gains to something more normal.\u201d<\/p>\n<\/blockquote>\n<p>Uhhh \u2026 132K for a month is not exactly\u00a0<em>normal<\/em>, at least not in a healthy economy. It\u2019s at best a population-maintenance level of jobs growth in a month, not a sign of growth.\u00a0The White House has argued for the last month that jobs growth shows that the US has not entered a recession. If the next month\u2019s report on Friday shows that job expansion has dramatically decelerated, that argument won\u2019t hold up.<\/p>\n<p>If this report is accurate, it also means that we\u2019re likely to come up far short of full recovery from the pandemic in that dynamic sense of population growth, a point I raise routinely now that Joe Biden and his team claim that equaling the employment numbers of February 2020 is the same as a full recovery. From <a href=\"https:\/\/hotair.com\/ed-morrissey\/2022\/08\/05\/booming-still-us-adds-528k-jobs-in-july-n487603\" target=\"_blank\" rel=\"noopener\">last month\u2019s job report review<\/a>:<\/p>\n<blockquote>\n<p>What about the pandemic recovery claim? Well,\u00a0<em>sorta<\/em>. With this report and the revisions to the last two months (net +28,000), official non-farm employment in the US has reached 152.536 million. That\u2019s finally above the pre-pandemic level of 152.504 million of February 2020.\u00a0<em>However<\/em>, the US population has not remained static in that period.\u00a0<a href=\"https:\/\/hotair.com\/ed-morrissey\/2022\/07\/08\/green-light-for-the-fed-us-adds-372000-jobs-in-june-n481383\" target=\"_blank\" rel=\"noopener\">As I noted last month<\/a>, we\u00a0<a href=\"https:\/\/www.macrotrends.net\/countries\/USA\/united-states\/population\" target=\"_blank\" rel=\"noopener\">added nearly 4 million people<\/a>\u00a0to the population in 2020 and 2021, let alone what we\u2019ve added this year. At an employment-population ratio of 59%, we would need to add about 2.4 million\u00a0<em>more<\/em>\u00a0new jobs to fully and dynamically recover from the pandemic crash. We should be at somewhere closer to 155 million non-farm jobs, in other words, so we are still recovering jobs \u2014 this time from the lost job creation of the last 30 months.<\/p>\n<\/blockquote>\n<p>If this newly revamped ADP report is an accurate predictor, we will likely fall short of a full recovery. But\u00a0<em>is<\/em> it? Note well <a href=\"https:\/\/adp-ri-nrip-static.adp.com\/artifacts\/us_ner\/20220831\/ADP_NATIONAL_EMPLOYMENT_REPORT_Press_Release_2022_8%20FINAL.pdf\" target=\"_blank\" rel=\"noopener\">their projection for July<\/a>, emphasis mine:<\/p>\n<blockquote>\n<p>Private employers created 132,000 jobs in August, a step down from the month before, when the economy created <strong>nearly 270,000 jobs<\/strong>. Payroll growth also slowed in July when compared to June of this year.<\/p>\n<\/blockquote>\n<p>See the problem? ADP\u2019s level of jobs growth in July came in at slightly over\u00a0<em>half<\/em> of the BLS\u2019 reported jobs in the same month (528K). If ADP intended to retool its reporting with Stanford to produce a more predictive model in alignment with the BLS\u2019 official reports, their first foray into that effort doesn\u2019t look like much of a success.<\/p>\n<p>On the other hand, the trendline is still valuable \u2026 or at least it\u00a0<em>could<\/em> be. If we take the ADP trendline as predictive and job growth got cut in half for August in comparison to July, we would still expect a BLS number on Friday to come in at around 260K, which would be a dramatic decrease in the pace of job expansion over the past year. It\u2019s not\u00a0<em>bad<\/em>, but it would definitely be a sudden and significant deceleration in jobs growth that would look even more significant in relation to two successive negative GDP reports.<\/p>\n<p>And it may well be that the spectacular number in July was the result of a massive shift of demand from the future. <a href=\"https:\/\/www.wsj.com\/articles\/job-openings-hiring-economy-july-2022-11661805200?mod=Searchresults_pos3&amp;page=1\" target=\"_blank\" rel=\"noopener\">The Wall Street Journal notes<\/a> that a lot of job openings got filled in July that may have been hanging around a while, and that may impact hiring in August:<\/p>\n<blockquote>\n<p>U.S. job openings rose in July as employers scooped up workers in a tight labor market.<\/p>\n<p>The Labor Department on Tuesday said there were a seasonally adjusted 11.2 million job openings in July, up from the previous month\u2019s upwardly revised 11 million. Job openings have remained elevated and above 10 million since the summer of 2021.<\/p>\n<p>The number of times workers quit their jobs edged down to 4.2 million in July from the prior month\u2019s 4.3 million. Layoffs and discharges fell slightly to 1.4 million in July from the prior month\u2019s level. Hiring slowed slightly to 6.4 million, down from 6.5 million in June.<\/p>\n<p>The jobs market remains strong, but some signs have pointed to slowing momentum as the Federal Reserve raises interest rates to tamp down inflation running near a four-decade high. The average pace of job growth in the first half of the year was slower than in all of 2021, and new applications for unemployment benefits have hovered near the highest point of the year in recent weeks.<\/p>\n<\/blockquote>\n<p>Friday\u2019s BLS report will clear up a few of these questions, not the least of which is how seriously we can take ADP\u2019s projections in the future. At this point, nothing would surprise me about Friday\u2019s report, so stay tuned \u2014 and keep your talking-point powder dry.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>It\u2019s\u00a0baaaa-aaaaack \u2026 and it\u2019s bad. ADP took the summer off to retool its monthly National Employment Report, thanks to a consistently non-predictive result when compared to the official jobs reports<\/p>\n","protected":false},"author":1,"featured_media":1628990,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[],"class_list":["post-1628988","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1628988","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1628988"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1628988\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1628990"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1628988"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1628988"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1628988"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}