00:00 Speaker A
It’s interesting, Laura, because you’ll hear other economists say, listen, inflation, I mean, it is not where J. Powell wants it to be, but they’ll say the Fed now is firmly focused on the weakening in the labor market, and that’s why they say the cut is a lock in September. What do you say to that?
00:24 Laura
Sure, I think the labor market is softening, but we have to remember that it’s softening from such an incredibly tight starting point. We still see general balance in the market. Um, it’s just balanced at a slightly lower level. So, one of the metrics that I use, it’s not just the jobs numbers, how many jobs were created, but it’s how many unemployed workers do we have for each available job opening? Right now that number is hovering right around one to one. Um, typically, we, in a kind of normal labor market, we see multiple job seekers for each available open position. So, I know this feels different than it has felt in recent years. It certainly is, um, very skills based. There might need to be some reskilling that takes place. But generally, we’re just seeing the labor market at balance at a slightly lower level. That is fewer job seekers and fewer jobs being created. Both, as we have demographic challenges with labor availability, um, limited numbers of young folks aging into the labor market versus those baby boomers who are now finally retiring. We also have negative net immigration expected this year. That’s going to limit labor availability in certain key sectors. Now, on the other hand, businesses are feeling all of this policy uncertainty. They want to play their cards closer to the vest. So, we also don’t see a broad swathe of new job creation happening, um, new available positions coming up. So, all this means to me is that we’re still generally in balance. Neither side is significantly out of whack at this moment, but it’s just at reduced numbers. I think that’s something we’re not used to contemplating with regards to say how the jobs report comes out.
