QUICK QUILL — With Friday’s jobs data qualifying as “definitive,” the question becomes one of how investors react to the possibility of a July rate cut. THAT will determine the speed with which the yield curve un-inverts. All you need know is that after a two-year wait, the steepening has finally arrived.
TAKEAWAYS
- In Q3 2023 alone, benchmark revisions lowered payrolls by -686,000, leaving the final tally 918,000 below what was first reported; meanwhile, of the 1.009 million workers who joined the labor force in the last 12 months, 814,000 have joined the ranks of the unemployed
- Temporary employment collapsed -9.0% QoQ in Q3 2023 and -8.1% QoQ in Q4 2023, far outpacing Q4 2007’s -3.7% and Q1 2008’s -6.3% at the start of the GFC; weakening temp payrolls, i.e. labor demand, will continue to pressure real business equipment investment
- From Q3 2023 to Q2 2024, the Very Short-Term Job Leavers-Permanent Job Losers spread fell from 15.5% to 7.7%; these are akin to Q2 and Q3 2008’s 15.8% and 7.5%, seen nearly a year into the GFC, and the current compression flags downside for average hourly earnings