Financial and economics experts are raising the alarm about the recent jobs data since the estimate includes a disproportionately large number of government sector employees.
On Friday, the Bureau of Labor Statistics (BLS) issued its monthly employment report, showing that 209,000 jobs were gained in June, much lower than the 309,000 jobs added in May and below what experts had projected. Some analysts saw the BLS’s announcement of 60,000 new government positions in June and an average of 63,000 new jobs per month for the year as signs of an impending recession. This compares to 23,000 new government jobs in June of last year.
Economist Eugenio Aleman said the first indication is that the U.S. will slow a lot in the second half of 2023. Aleman attributed this prediction to the poor private job growth in recent months.
An economics professor at FAU (Florida Atlantic University) said when job numbers are suddenly listing toward weakness and inflation falls rapidly, and the Fed plans to keep over-tightening, the economy is on dangerous ground. He said the high numbers may persist for a few more months. However, a significant slowdown is expected once the overall statistics approach those from early 2020.
According to economist Peter Earle (American Institute for Economic Research), the absence of private hiring is a symptom of slowing economic growth, and he thinks a recession is imminent.
According to Earle, the impending recession is just one more example of the economy’s subpar performance as a whole.
Earle predicted that after the first and second quarter GDP drops in 2022, the United States will enter the second dip of a double-dip recession. According to his calculations, the next recession will likely occur by September 2024.
Meanwhile, the Biden administration paints a rosy picture and is proud of what they call Bidenomics.