Job growth has slowed sharply; the question is why
15 days ago
- #policy impact
- #economic slowdown
- #labor market
- Signs of a slowing economy emerged with modest real GDP growth and rising inflation.
- Job growth slowed sharply starting in May, with significant downward revisions in May and June, and a modest increase in July.
- The unemployment rate increased in July, aligning with other economic slowdown indicators.
- Policy changes such as higher tariffs, reduced immigration, and government downsizing contributed to the economic slowdown.
- Large revisions in job data raised questions, leading to the firing of the BLS Commissioner by President Trump.
- Economic policy shifts caused unpredictable changes in consumer and business behavior, complicating real-time data measurement.
- The June downward revision in job data was primarily due to new data collections and updated seasonal factors.
- Slower job growth is attributed more to reduced labor supply (e.g., immigration cuts) than weakened demand, though both factors play a role.
- The unemployment rate and wage growth trends suggest labor supply as a key driver of the slowdown.
- Fed officials have varied reactions to the employment report, with some emphasizing a gradual cooling of the labor market.
- Industry-specific impacts, such as delayed infrastructure projects, highlight both supply concerns and long-term cost increases.