US in ‘labor recession’ as shock new figures reveal downturn

The US jobs market is in much worse shape than initially thought, according to a new revision of the data. 

The number of jobs added to the economy for the year through March could actually be 911,000 less than previously reported. 

That would mean nearly 76,000 less every month, according to the government’s preliminary benchmark revision. 

It comes after the latest report painted a gloomy picture, with just 22,000 jobs added in August, far below Wall Street’s forecast of 75,000.

June’s figures were also revised down to a net loss of 13,000 jobs, underscoring signs of a slowing labor market. 

Leading figures now believe America is in a ‘jobs recession’ that risks pushing the rest of the economy into a full blown recession.

Mark Zandi, the chief economist of Moody’s Analytics, said a ‘labor recession’ is already underway and that further revisions risk tipping the economy over a cliff.  

Zandi added that an uptick in layoffs – already up 140 percent from a year ago – would also darken the situation. 

Mark Zandi, the chief economist of Moody’s Analytics, said a ‘labor recession’ is already underway

‘If businesses start laying [people] off, then I think this will not just be a jobs recession, it will be an overall economic downturn,’ Zandi told Business Insider. 

‘Everything is clinging tightly to the lip of the cliff,’ he told the publication. 

‘We had 10 fingers on the edge of the cliff a couple months ago, we now [have] seven fingers. 

‘A couple more fingers, and we’re going, then we’re going over the edge.’ 

Federal Reserve chief Jerome Powell has also indicated concern about the labor market and suggested it will be a contributing factor to an imminent cut to the benchmark interest rate. 

However, Zandi suggests even the lowering of borrowing costs will not be enough to prevent a recession. 

‘A lot of the benefit of the lower rates is already in the [market] because investors anticipated the rate cuts,’ he said. 

White House Press Secretary Karoline Leavitt said the revised numbers suggested that Trump ‘was right’ in his claims that ‘Biden’s economy was a disaster and the BLS is broken.’ 

Workers said they believed there was a 45 percent likelihood of finding another job if laid off

‘This is exactly why we need new leadership to restore trust and confidence in the BLS’s data on behalf of the financial markets, businesses, policymakers, and families that rely on this data to make major decisions,’ Leavitt said in a statement. 

‘Much like the BLS has failed the American people, so has [Federal Reserve chair] Jerome ‘Too Late’ Powell – who has officially run out of excuses and must cut the rates now.’

Workers are aware of the precarity of the labor market believing there is just a 45 percent likelihood of finding another job if they found themselves unemployed, a New York Federal Reserve survey has revealed. 

The confidence survey took an almost 6 percent drop from the month before, and is the lowest in the survey’s history. 

‘Consumers are feeling down about job-finding opportunities, and those feelings are wholly appropriate,’ Elizabeth Renter, senior economist at NerdWallet told CNBC. 

‘It’s very difficult to find work right now and unlikely to get better any time soon,’ Renter explained.  

‘Employers aren’t hiring much, so workers are stuck job-hugging, clinging to their current jobs because the market isn’t favorable to job seekers.’

Zandi also recently warned that a third of the US is already in or at high risk of going into a recession. 

Last month he pointed to the fact that more than half of US industries are cutting jobs as a glaring red flag that a recession is imminent.