#labor-market

#labor-market

As expected, inflation ticked slightly higher during August with rising housing, food and energy costs leading the way. Core inflation however remained stable, ensuring a rate cut in September is now a forgone conclusion. The Federal reserve having been in wait and see mode since December 2024 has been given the green light today to cut rates. Inflation has not seen large upside surprises from tariff turmoil and with recent revisions to jobs data showing almost 1 million fewer jobs than previously thought,

Most economists believe the Fed will cut rates at its meeting next week after recent data revealed a labor market that's been softening for longer than previously thought. While inflation also remains stubbornly above the U.S. central banks 2% target and is forecast to have risen again in August, Fed officials have increasingly expressed concern about a slowing U.S. job market.

New labor data showing shrinking job opportunities and increased unemployment has perhaps stoked the fears of wealthier Americans more than their lower-income compatriots. The New York Federal Reserve's August 2025Survey of Consumer Expectations found Americans earning more than $100,000 more often believe unemployment will rise in the next year compared to those earning less. Increased pessimism may be a result of fears that white-collar jobs are being impacted by the rocky economic and political environment.

The dismal August jobs report confirmed the labor market cooled significantly during the spring and summer. That coincided with the start of President Donald Trump's trade war. While some tariff-impacted industries have seen minimal changes in payrolls, others like manufacturing and wholesale trade have taken bigger hits. Since President Donald Trump launched his trade war earlier this year, industries impacted by tariffs have shed tens of thousands of jobs.

The latest jobs report revealed the U.S. economy added just 22,000 jobs in August with revisions to prior months showing June actually saw a decline. Meanwhile, the unemployment rate edged up to a four-year high of 4.3%. In a note on Saturday, Torsten Sløk, chief economist at Apollo Global Management, observed that job growth in tariff-impacted sectors is negative. Manufacturers alone cut 12,000 workers last month.

The 'manufacturing recession' - underway for years - got uglier. The sector lost 12,000 jobs in August, the fourth consecutive month of shrinking employment. The industry had 78,000 fewer workers last month, relative to the same period a year ago. Construction shed jobs for the third straight month. Wholesale trade - a sector that includes transportation, warehouse staff and material handlers - has lost 32,000 workers since May.

Driving the news: Friday's jobs data confirmed that the weak hiring that became clear in last month's report was no head-fake. The economy added just 22,000 jobs in August, with health care among the few sectors with increasing employment. The intrigue: Once again, the real stunner came in the revisions, which showed the economy's 53-month-long streak of jobs growth ended in May.

From chronic struggles with burnout to a pragmatic, even skeptical take on how to lead their careers, the generation that entered the workforce during the age of quiet quitting has come to exemplify the quarter-life crisis. But what if this is the new norm, and the midlife crisis is going extinct the way other trappings of the 20th century have, like dial-up internet and Kodak film? What if Gen Z has giant, macroeconomically valid reasons for being plunged into a collective quarter-life crisis?

Two hundred and twenty-nine thousand, once again, just dovetails right in. I think the most important issue is we have 250,000 right on the nose on the first week in June. You have to go to October of last year to find a number above 250,000, so it's hard for me to get worried about this; and if this is considered the best real-time evaluation of the labor market, there's no issues that it's sending.

"curious kind of balance that results from a marked slowing in both the supply of and demand for workers."

If this experiment fails, it's gonna fail horribly, and I think we'll begin to see the impacts of that sooner than later,