A version of this story first appeared in CNN Business’s Before the Bell newsletter, not a subscriber? can register here. You can listen to the audio newsletter by clicking on the same link.
September’s hot-anticipated job data is over. friday evening marketStocks fell sharply as investors assessed the report. which shows more employment than expected was added to the US economy. White-collar workers weighed down by Fed rate hikes And it indicates that a painful rate hike from the Federal Reserve lies ahead.
but numerical distribution It shows that the Fed’s plan to weaken the labor market to combat persistent inflation may already be working. not for everyone.
White-collar office workers seem to feel strongly about the Fed’s actions: The financial and business sectors saw a sharp drop in employment last month. Legal services and advertising have also declined.. while services and construction workers continued to flourish.
what happened: US economy Added 263,000 jobs in September Beating analyst expectations of 250,000 jobs, the unemployment rate was 3.5%, down from 3.7% in August.
The increase in employment was the leisure and hospitality industry, which added 83,000 jobs in September. And employment in food service and drinking establishments made up 60,000 of those jobs alone. Manufacturing and construction were also hot, adding 22,000 and 19,000 jobs respectively.
The biggest non-government payrolls came from the financial industry, which dropped 8,000 between August and September. Big banks are hiring around. Extend the offer to recent graduates in early fall. That makes this September drop particularly important.
Business support services such as telemarketing, accounting, and administrative and administrative tasks – are also lost. This sector lost 12,000 in September. meanwhilelegal services lost 5,000 jobs, and advertising services also dropped 5,000.
What does it mean: The Federal Reserve’s poor policies seem to cool some parts of the economy. but not other parts Finance officials are likely to begin to panic. Because their industry relies on stock and credit markets. which was heavily affected by the Fed’s actions.
Friday’s numbers indicate that we are starting to see that impact in employment data.
What remains to be seen is whether the Fed can cool the economy by simply laying off jobs in white-collar industries, or if these losses will flow to other industries, affecting earning workers. little
come up: start earning season Seriously this week with big banks like JPMorgan, Citigroup.
(c)Morgan Stanley
(miss) and Black Rock
(BLK) Reporting. Investors will be closely watching for recommendations on plans for employment and termination.
The two major inflation indicators are PPI and CPI that will be released as well. Expect the market to react poorly if inflation heats up.
A top US panel of economists has just released its economic outlook for next year. which is still not good
A panel of 45 forecasters led by the National Association of Business Economics (NABE) said they expected slower growth. higher inflation higher interest rates and employment declines in both 2022 and 2023, more than previously expected.
Most of the concerns stem from the Federal Reserve’s interest rate policy.
“More than three-quarters of respondents believe there is a 50-50 or less chance the economy will achieve. “More than half of the panelists said the biggest negative risk to the US economic outlook was excessive financial tightness.”
NABE panelists downgraded their median real GDP forecast for the fourth quarter of 2022 to a 0.1% increase, compared with a 1.8% increase in the May 2022 survey. It will be more than 25% of the recessions occurring in 2023, with the most likely to begin in the first quarter.
The latest report comes as a growing number of economists predict a recession is imminent, former US Treasury Secretary Larry Summers. told CNN on Thursday. that it is “more likely than not” that the US will enter a recession. call it a consequence of “The surplus that the economy has passed”
Friday’s employment report showed the share of workers working by telephone or working from home due to the pandemic has declined. It dropped to 5.2% in September from 6.5% in August.
Full-time remote work in the USA which many predict will remain the norm for a long time after the pandemic.
seems to unravel Especially as the job market loosens for white-collar workers and less empowered workers.
last week, KPMG survey Of US CEOs, two-thirds believe office work will be normal within the next three years.
Still, it may not be enough to help the ill-fated commercial real estate market. New York City office buildings are down nearly 45% in 2020 and are expected to remain 39 percent below pre-pandemic levels over the long term as hybrid policy continues. latest study from the National Bureau of Economic Research
Looking forward: Bureau of Labor Statistics noted that While hybrid jobs may still be popular, COVID-19 is no longer spurring jobs from the home trend.He October reports to rephrase. telework question to remove references to pandemic. White-collar workers weighed down by Fed rate hikes
As of May 2020, each job report asks: “In the last four weeks You can work remotely or work from home to get paid at any time. Because of the corona virus epidemic?”
In May 2020, 35.4% said yes.
start next month question will be solved “In the past week You work remotely or work from home to get paid at any time.” It will ask Timeline limits. and eliminate references to the pandemic
US bond markets are closed for Columbus/Indigenous Day.
Coming this week:
▸ Q3 earnings season kicks off, expect reports from big banks like JPMorgan Chase.
(JPM)Wells Fargo
(AFC.)Citigroup
(c)Morgan Stanley
(miss)PNC
(PNC) and US Bancorp
(USB) and consumer products like Pepsi
(PEP)Walgreen
(WBA)s and Domino’s
(DMPZF).
▸ CPI and PPI, two closely watched measures of inflation in the United States, will also be released.
