As the nation began to emerge from the COVID-19 pandemic months ago, there were plenty of economic experts predicting that a massive glut of American prosperity was just over the horizon.
This would be a new “roaring twenties” according to many, who saw Americans with forced savings ready to emerge back into the world at large.
Instead, somehow, President Joe Biden botched the whole thing. Now we’re staring down an official recession, with inflation still running rampant and a housing market that’s cooling off faster than expected.
Now, to make matters worse, it appears as if the job market is making a rather significant downturn as well.
The number of job openings in the United States fell sharply in June as the Federal Reserve hiked interest rates, gas prices hit record highs, inflation soared, and growth in consumer spending slowed.
There were 10.7 million postings for job openings on the last business day in June, the U.S. Bureau of Labor Statistics said Tuesday, down from an upwardly revised 11.3 million a month earlier.
Economists had been expecting 11.1 million jobs in the June report on the government’s Job Openings and Labor Turnover Survey, or JOLTS. The sharper than expected decline indicates that demand for labor has plunged faster than economists expected.
Some specific portions of the economy were particularly hard-hit.
Openings declined sharply in both retail and construction, two areas that have showed signs of softening in recent months. Consumer spending rose 1.1 percent in June before adjusting for inflation, according to the Commerce Department’s tally of consumer expenditures released last week. Real expenditures, after adjusting for inflation, were just 0.4 percent higher—and much of that increase reflected higher prices of food and groceries. Spending on discretionary goods and services likely fell in inflation-adjusted terms.
Hiring rates fell at large businesses with more than one thousand employees, the government said. This suggests that businesses are preparing for an economic downturn by pulling back from bringing on new employees.
The news seems to indicate some real timidity among market movers, and their reticence to invest in new labor could have a trickle-down effect on the economy as a whole.
