I'm sure you've been seeing a lot more headlines lately about layoffs. But, despite the worries about increasing unemployment or hiring freezes, the labor market has continued to go strong. But will that change? According to the latest jobs figures from the payroll software company ADP, private employers are still hiring, but they only added 132,000 jobs in August—less than half of what economists had expected. That's the second straight month of job growth declines.
ADP's report comes just days before the Labor Department releases its more detailed report on the jobs market. So you would think that if today's job numbers weren't great, then Friday's won't be too good either, right?
Not necessarily. The ADP figures haven't been a very good predictor of what's to come in the government's report, which offers a more complete picture of the labor market. But what we can see from the figures—and the latest headlines—is that companies are slowing down their pace of hiring as recession fears continue to rattle businesses, investors, and everyday Americans.
CFOs recently surveyed by Deloitte say they are cutting their growth expectations for wages and hiring, according to Deloitte's Q3 2022 CFO Signals report released earlier this week. Expectations for hiring growth fell to 2.6%, from 5.3% in the second quarter of 2022—the first significant drop since the second quarter of 2020.
So will layoffs start to rise? And should you be worried about your job?
Well, those figures still mean employers are looking to hire, but at a much slower pace. And according to yesterday's figures on job openings, the number of jobs still available in July held steady. What's more, economists are expecting unemployment—which currently sits at a two-year low of 3.5%—to remain unchanged. We might also get a better sense of how well the labor market is performing tomorrow, when the Labor Department releases data on the number of people filing for unemployment benefits.
Storm clouds are starting to brew in the nation's jobs market, and Friday's report from the Labor Department could show us just how close the storm is.
- Kristin
