According to the BLS, the economy added 315k jobs in August, which was on par with analyst estimates. While the job numbers continue to appear strong, a deeper look into the data shows some trends that may indicate weakness.
The Kansas City Federal Reserve Bank published a rather surprising paper that swerves into the truth – the Fed can’t win this inflation fight. In this episode of the Friday Gold Wrap podcast, host Mike Maharrey talks about the paper. He also discusses the possibility of a dollar decline and gives his first impression of the August jobs report.
The July non-farm payroll report came out much stronger than anticipated. According to the Bureau of Labor Statistics, the economy added 528,000 jobs and the unemployment rate ticked down to 3.5%. The narrative was that this blockbuster employment report proves that we’re not in a recession.
In his podcast, Peter Schiff broke down the data and reveals the truth behind the “strong job market” hype.
According to the BLS, the economy added 528k jobs in July, blasting past analyst estimates of 250k. The strong report comes on the heels of a Fed meeting last week that made a point to state they are hyper-focused on the job market as a sign of a weakening economy. The White House and Fed are now in lock step ignoring negative GDP growth and hanging their hat on the job market. For now, that message fits their narrative.
Despite back-to-back contractions in GDP, President Joe Biden, Fed Chair Jerome Powell, Treasury Secretary Janet Yellen and all of their supporters in the corporate media insist the US economy isn’t in a recession. But the only data they ever point to in order to back up their assertion is the “strong” labor market.
The problem with this spin is the labor market is a lagging indicator and it’s starting to show cracks.
The mainstream seems to have conceded that the economy is heading toward a recession. But most people aren’t too worried. They seem to think the downturn will turn out short and shallow. In his podcast, Peter explains why the recession will more likely be long and deep. Since people don’t understand the nature of the boom, they can’t understand the nature of the bust.
According to the BLS, the economy added 372k jobs in June. This exceeded the 250k market expectations and seems to indicate the labor market is more resilient than the rest of the economy which the Atlanta Fed currently forecasts as being already in recession. While resiliency is a positive sign for the economy, a strong job market will make it harder for the Fed to bring down inflation.
And there are some signs of weakness when you dig into the data – particularly the revisions.
The May jobs report was widely regarded as strong. The US economy added 390,000 jobs, according to the latest data. But a deeper dive into that data reveals that the labor market might not be as strong as the mainstream spin is leading you to believe. Even with all the new jobs, hiring slowed in five out of eight sectors.
According to the BLS, the economy added 428k jobs in April. This exactly matched the March number after it was revised down by 3k. The unemployment rate stayed flat at 3.6%. The Labor Force Participation rate dropped from 62.4% to 62.2%. YoY, this April is up 165k jobs compared to last April.
According to the BLS, the economy added 431k jobs in March. February was revised up to 750k from an original 678k. The unemployment rate fell to 3.6%.
It would appear this was another strong jobs report. But when you did into the data, it’s not that clear-cut.