This week we examine the resilience displayed by the U.S. labor market and share detailed insights on job growth, wage dynamics, inflation indicators, and the Federal Reserve’s recent stance on interest rates.
Key insights:
- April’s job additions maintain a robust three-month average of 242,000 jobs per month.
- Despite a stagnant unemployment rate of 3.86%, the slowdown in wage growth suggests economic stabilization.
- Average hourly earnings rose by a modest 0.2% in April, reflecting a 2.8% increase over the last three months.
- Although unit labor costs experienced a marginal Q1 increase, year-on-year growth has decelerated to 1.8%, boding well for inflation trends.
- The narrowing gap between labor demand and supply indicates forthcoming moderation in wage growth.
- The recent decision by the Fed to maintain the target range of 5.25%-5.5% for federal funds underscores a meticulous data-driven approach to rate adjustments.
More from TWO THE POINT
- Two the Point — Cooling Jobs, Warming Cuts?
In our weekly video series, we highlight one observation we think is most important regarding the economy and the financial markets. This week we discuss highlights from the August labor market report. - Two the Point — Rate Cuts & Labor Pivots: What Lies Ahead?In our weekly video series, we highlight one observation we think is most important regarding the economy and the financial markets. This week we discuss rate cuts and labor pivots.
- Two the Point — Shifting Gears: Powell Signals Rate Cuts on the HorizonIn our weekly video series, we highlight one observation we think is most important regarding the economy and the financial markets. This week we discuss Federal Reserve Chairman Jerome Powell’s speech at the Jackson Hole Economic Symposium.
