The monthly employment snapshot of the government’s Bureau of Labor Statistics is expected to show continued strength: smaller but still significant labor gains of about 272,700 and an unemployment rate of 3.6% , according to estimates by Refinitiv.
The report comes after a series of recent employment data: the latest job vacancy and rotation survey, released on Wednesday, showed there were 11.3 million jobs open in May, or 1 , 9 places for each job seeker, and historically low. dismissal levels.
While this is good news for job seekers, there are also indications that employers are starting to cut back. New job cuts data released Thursday by Challenger, Gray & Christmas revealed that U.S. employers announced 32,517 layoffs in June, up 58.8% from the same month last year, and the highest monthly total since February 2021. Total reduction in jobs during the first six months of the year, however, have fallen by 37% compared to the first half of last year and are at their levels lowest since record-breaking began in 1993. The U.S. labor market is clearly not in recession. However, unemployment may be a delayed indicator. In recent weeks, major technology and real estate companies have announced layoffs (including Netflix, Tesla and Redfin) or indicated they will withdraw hiring plans (such as Meta, Twitter and Apple). Details of Friday’s job data could help economists, policymakers and business leaders figure out if this recent wave of layoff announcements and hiring freezes are just industry-focused fixes after years of indomitable growth , punctual company or signs of broader weakness. Historically high inflation has pushed the Federal Reserve to embark on a campaign of rising interest rates to cool the economy, but these efforts do not come without costs: as companies tighten their belts, they typically they translate into job cuts. Fed Chairman Jerome Powell has said he is aware that rate hikes could cause “pain” in the labor market, but has also expressed hope that, if successful, policy-making actions can allow the economy continues to grow as they curb inflation. The latest Fed projections indicate that the unemployment rate will rise to 4.1% in 2024.
“We’re already seeing some companies start to retire from hiring, either by freezing hiring or simply acting more slowly to cover their existing job offers,” said Daniel Zhao, senior economist at Glassdoor. “This is the first step companies take when they expect the economy to slow down. Invariably, if there is a recession, there are likely to be layoffs as a result, but the hope is that if the recession is mild, layoffs will occur. be contained and, as a result, any increase in unemployment will be less. “
More generally, the U.S. labor market is still in a period marked by incredibly high demand for workers, said Layla O’Kane, a senior economist at labor market data firm Lightcast.
“We’re seeing very high openings and very low separations,” he said, referring to the latest JOLTS data. “Right now, companies are still looking for a lot of workers and are trying to fill those positions. I would be surprised if the job market shifted to a difficult market for workers soon.”
CNN’s Nicole Goodkind contributed to this report.