In July, a cooling was recorded in the United States labor market, which turned out to be more widespread than preliminary forecasts regarding the most likely dynamic of the state of affairs in the relevant space.
Against the background of the mentioned data, concerns have increased that the US economic system is slowing down too quickly. If the current situation worsens, the realism of implementing a recession scenario in the foreseeable future will significantly rise. The United States has made some progress in its efforts to counteract inflation, but the state of affairs in the country’s economic system signals substantive risks. At the same time, it is worth noting that the materialization of negative scenarios is not guaranteed and does not belong to the category of what can be described as configurations of the future that cannot be avoided.
Last month, businesses added just 114,000 jobs in the United States. The Bureau of Labor Statistics released the relevant information on Friday, August 2. The unemployment rate in the United States rose to 4.3% in July after 4.1% in June. It is worth noting that the figure recorded last month is the highest since October 2021.
Economists surveyed by the media expected that US businesses would add 175,000 jobs in July. They also predicted that the unemployment rate would not change and would remain at 4.1%.
This year, the opinion has been actively circulating in the United States that the local labor market is on a trajectory of gradual recovery to the state of affairs that was observed before the coronavirus pandemic. The July data signals a significant probability that the mentioned viewpoint is incorrect. There is a high risk that the US labor market will show a sharp weakening in the short term.
As we have reported earlier, Jerome Powell Says About Confidence in Dynamic of US Inflation.
