“In spite of the success we continue to see on Main Street, the manic predictions of recession are having a psychological effect and creating uncertainty for small business owners throughout the country. Small business owners continue to invest, grow, and hire at historically high levels, and we see no indication of a coming recession.”
In other words it would seem the drumbeat of negativity and talk of a recession is impacting expectations and sentiment. These are a few examples how the economy can get talked into a recession.
- The preliminary report for Total Separations shows this category was up 246,000 to 5.759 million.
- The largest increase was in the voluntary quit category, up 130,000. If one looks at year over year, only quits are higher. Individuals generally quit their job if they believe they can find a better/higher paying one. With ‘Quits’ continuing to increase, this is certainly an indication of a strong job market. Layoffs and other separations are lower year over year.
- On a rolling 12-month basis, Hires less Separations total 2,554,000.
- “When the number of hires exceeds the number of separations, employment rises, even if the hires level is steady or declining.”
- “Conversely, when the number of hires is less than the number of separations, employment declines, even if the hires level is steady or rising.
- “Over the 12 months ending in July, hires totaled 69.6 million and separations totaled 67.0 million, yielding a net employment gain of 2.6 million. These totals include workers who may have been hired and separated more than once during the year.”
This data around the job market represents current activity and not expectations. Based on the JOLTS and the NFIB Survey, it seems the job market is certainly tight/strong. It is difficult to image an economy tipping into a recession with this kind of survey data around the job market. I believe much of the angst for the U.S. economy is being influenced by the commentary or headlines around a potential recession. It is possible the U.S. is becoming less synchronized with economies overseas and thus the U.S. can continue to grow in spite of some slower economies abroad. Maybe the U.S. grow is not above trend, but growth nonetheless.