When President Joe Biden says the economy is “working,” it’s hard not to picture the Wizard of Oz warning everyone not to peek behind the curtain.
A look behind the curtain is only for the brave of heart.
The U.S. Bureau of Labor Statistics recently announced that the economy created 818,000 fewer jobs last year than previously thought. In the last ten years, the Bureau’s annual update has added or subtracted only about 173,000 jobs on average to the prior estimated total. The latest number is 373% higher than that average.
In July, the unemployment rate jumped to 4.3%, triggering the Sahm Rule. Created by Federal Reserve economist Claudia Sahm in 2019, the Sahm Rule is an indicator that has accurately signaled nearly every U.S. recession since the 1950s based on historical data. According to the rule, a recession is imminent if the unemployment rate’s three-month moving average rises half a percentage point or more from its low the previous year. Following the latest unemployment numbers, the Sahm Rule hit .53%.
Prices keep going up and up. U.S. manufacturing activity fell to an eight-month low in July. A survey by Affirm found that roughly 3 out of 5 Americans believe the U.S. is in the midst of a recession.
It’s time to get out those ruby slippers, click the heels together, and pray this nightmare is over soon.
The Wall Street Journal reports on more evidence that Bidenomics is “working,” as wages for new hires in many blue-collar sectors are now falling after white-collar hires saw the same. Here’s the start of the story:
Bosses are quietly trying to reset worker pay levels, saying the era of overpaying for talent is over.
Pay for many white-collar recruits shrank last year, and now wages for new hires in construction, manufacturing, food and other blue-collar sectors appear to be ebbing too, according to an analysis of millions of jobs posted on ZipRecruiter.com. Job seekers report seeing roles that once offered salaries between $175,000 and $200,000 a year ago now being advertised for tens of thousands of dollars less, a change that has had them rethinking their pay expectations. Companies are also moving job openings to lower-cost cities or offering them as lower-paying contractor roles, recruiters and corporate advisers say.
The push to reset employee salaries reflects a power shift in the cooling hiring market. Employers have more choice of who they can hire, and at what pay level, and are questioning whether they really need star hires when a workhorse will do. Even hourly jobs that were until recently the toughest for employers to fill are being advertised at lower pay than a year ago, as are some professional roles, according to business leaders and recruiters.