hired 6.6 million people, a slight increase from May. This represents a hiring rate of 4.2%, down slightly from May’s 4.3% but still above pre-pandemic levels.
Quits rate declines. The quits rate, which measures the percentage of workers leaving their jobs voluntarily, fell to 2.7% in June from 2.9% in May. While this metric remains elevated, signaling worker confidence in the labor market, the decrease suggests a potential cooling in job market dynamics.
Initial claims for unemployment insurance rise. The number of individuals filing for unemployment insurance for the first time increased to 353,000 in the week ending July 30, up from 349,000 the previous week. While still historically low, the increase indicates some softening in the labor market.
Manufacturers expect further deceleration in hiring. The ISM Manufacturing Employment Index dropped to 50.9 in July, down from 52.9 in June. This suggests that while employment in the manufacturing sector is still expanding, the pace of growth is slowing.
Labor market confidence declines. The Conference Board’s Consumer Confidence Index fell to 111.2 in July, down from 116.0 in June. While still at relatively high levels, the decrease in confidence could be a sign of growing concerns about the labor market and the overall economy.
In summary, while popular recession indicators like the Sahm Rule may be sending false positives due to unique economic distortions, it’s important to look at a variety of metrics to get a full picture of the economy. The labor market is showing signs of cooling, with job creation slowing, wage growth moderating, and hiring activity decelerating. This puts pressure on the Federal Reserve to potentially loosen monetary policy to support economic growth and avoid a recession. As always, it’s essential to stay informed and keep an eye on evolving economic developments.