Labor Market Analysis

For months now, the JOLTS job openings have told a divergent story from other labor market indicators, such as quits, hires, and employment-based measures. This month’s data release is no different. While all labor market indicators show a strong labor market, the difference is one of magnitude: the job

Just how tight is the labor market? It depends on which measurement you pick! Some economists look to the unemployment rate, or to its difference from some estimated, but not measured, “natural level” to try to assess whether the labor market and economy are in equilibrium (we are not fans

Wage growth is slowing. Job openings are increasing, unemployment is holding, and wage growth is slowing. This was supposed to be impossible–so what does it mean that it’s happening?

Wage growth slowed in Q4 faster than consensus forecasts–-at an annualized rate just over 4%. We already noted in our preview that this would be very consistent with what the other Q4 macroeconomic & wage data was signaling. The scenario poised to trigger a hawkish overreaction did not materialize.

As we await the Q4 Employment Cost Index (ECI) release tomorrow (forecasting consensus: 1.2% QoQ, 4.9% CAGR; Q3: 1.2% QoQ, 4.8% CAGR), two key points to keep in mind. 1. The Q4 Data Showed Slowing Across Many Wage and Wage-Relevant Indicators, Potentially To 4.2% annualized.

While layoffs are painful to workers, more attention needs to be paid to the threat of a rise in unemployment arising from a slowdown in hiring. In this report, we examine the important role that a fall in hiring rates plays during unemployment increases.

The Fed says that the labor market needs to cool in order to bring inflation down. A key part of the case for maintaining the current pace of rate hikes is built on high measures of wage growth. Jay Powell cited the last average hourly earnings figure as one sign

A Labor Supply Shock? Much ado has been made about the shortfall in the headline employment-to-population ratio and the headline labor force participation rate of late. Many have claimed that recent wage and price pressures trace back to  a “labor supply shock”. Some have even tried to make the more

The Federal Reserve has given job vacancy data center stage in assessing the strength of the labor market. The theoretical and empirical issues with vacancies data show that this is a mistake.