Here’s a reaction to next month’s jobs report – 12 days before it’s released.
As we all know, the Bureau of Labor Statistics releases the monthly jobs report on the first Friday of the following month, with some exceptions, such as the first Friday is the first, or a weekend – July 4th.y, for example – distortion of the calendar. Next month, it will be on the 5thy At 8:30 am.
In the lead-up to the report over a couple of days, the “experts” start letting go of their predictions, and then once the report is released, there’s a flurry of coverage. Typically — and certainly in the past 27 months of post-recession recovery, the most dramatic of all — the report’s analyzes contained such phrases as “much better than expected,” “job growth significantly more than expected,” and “a continuous record breaking line.” If they really knew what they were saying, they wouldn’t have said it.Yet they are ready on their keyboards, ready to type and ready to quote economists, business experts, academics, and anyone else they can get their hands on.
Nostradamus I’m not, but…
Well, today I’m going to take a different approach. I’ll give you 12 days before the April report comes out – but please note that this is not a forecast or prediction. Economists make projections and fools make predictions – neither do I. Nostradamus I’m not. But there are some laws of nature in the labor market—a set of terms and conditions, if you will—that help explain what is going on, not in an analytical sense but in an interpretive way. Just to keep things straight, you won’t soon need me or any other human being to analyze the job market. AI already does. But you will need – and always will – to explain what is happening, and here AI cannot help you yet.
Understand the laws of the nature of the labor market
The truth is that these past two years – the first two years in the history of job creation – have been, in a sense, unexplainable from a pure data point of view – which is why the chain reaction that followed the release of the report is like the chatter you are talking about. heard during the intermission at a concert. Most people continue to express surprise month after month, amazement at how the market is doing, but I, for one, wasn’t surprised at all. Why? Given all the components of the market—job openings, hiring, layoffs, voluntary resignations, employee turnover—and then population and demographic trends—none of this should come as a surprise. In simple terms, we are in the best job market in history.
But all good things come to an end, some say, while they wait for the shoe to drop. Well, yes – not necessarily. I would expect the May 5 report to show some backtracking, but I liken it to Joe Dimaggio’s 56-game hitting streak in 1941 that ended 0-4. What did Joltin’ Joe do to follow it up? Another 17-stroke streak began. Is anyone surprised? no why? Because that’s the kind of hitter he was. And that’s the kind of market we’re in.
Recession is coming? Not so fast.
Then there is the issue of recession somewhere in the future. Now be warned: One month of slightly less job creation (if that’s what we got in the first place) doesn’t lead to a recession, but there are some who will announce it, especially as the election approaches.
The next recession we see will be 52Abbreviation II In our history recessions are as normal, predictable, necessary and uncomfortable as the expansion and contraction of hearts and lungs, the question is not if it will happen, but when. Then the question becomes, how do we deal with it? As a result, most recessions are mild, short, and awful. As you will do next and so forth.
So, before cacophony starts weighing in next month’s jobs report, consider what’s been going on for the last 27 months and what the big picture is, “what’s this all part of,” as Albert Einstein used to hope.