Raleigh – america on friday Job report shows many positives — From job growth to falling unemployment to labor force participation — economists such as Dr. Mike Walden of North Carolina State University are working to understand the impact of the report.
Walden stuck to his prediction that the unemployment rate will rise by 2 percentage points in North Carolina as the economy hits a recession this week. About 50,000 jobs were lost. why? Because the Federal Reserve keeps raising interest rates in its fight against inflation.
But Friday’s report also bolstered another prediction he had previously spoken about. It’s an economic slowdown, but few jobs are lost nationwide.
In his words:
“With the labor market continuing to perform well, it is virtually certain that the Federal Reserve will continue to push rates higher.
December jobs grow faster than expected again – economy adds 233,000 jobs
“But in addition to the fact that a growing labor market will help workers, the report may have another advantage: that the Federal Reserve (Fed) will make a successful so-called soft landing for the economy. There has been debate among economists over whether the Fed’s rate hikes will continue to moderate inflation, but not send the economy into recession.
The fact that the Fed’s massive rate hikes (more than 4 percentage points) so far have not caused job losses or increased unemployment can be read as evidence that a ‘soft landing’ is within reach. increase. But even if 2023 is officially marked as a recession, it could be the first recession in history without unemployment. ”
Walden said employment data shows the labor market “remains healthy.”
“Both the facility report, which looked at jobs in businesses, and the household report, which asked whether individuals had jobs, showed an increase in jobs. It doesn’t apply,” he explains.
UNC Economist: Today’s Jobs Report Shows Recession Coming in 2023
“Employment gains at businesses were smaller in December than in November, but there was still a significant increase in employment of 223,000 people. Households reported an increase in employment for the first time since September. has declined and the labor force participation rate has risen.
“All these figures show that the labor market remains healthy. In my view, the shift from unemployment to employment growth in the household survey was the most important indicator.”
Walden also said the numbers are subject to further analysis and revision. However, it should be remembered that these adjustments may be imprecise.”
“For example, if year-end buying was greater than the expected seasonal adjustment, the December numbers could be artificially positive. That’s why it’s important to keep an eye on the supporting data in the coming months, and yet the economy may be in a situation where the usual rules don’t apply. If we can keep inflation under control but the job market doesn’t crash, this will be a monumental achievement.”
Economists warn 50,000 people will lose their jobs in North Carolina if recession hits in late 2023
