In February, the amount of payrolls added to the system was around 20,000, compared to 311,000 jobs in January. This slow job growth month was about 160,000 jobs less than economists forecast. According to many economists this is more the residual of a slow growth month, not a signal of a recession. Two main points were the government shutdown and a teacher strike which pulled some data down with it. After the jobs report, the futures market dipped but they were already lower because of the weak Chinese export data. The ironic part about all this, is the 18.6% growth in housing starts in February which happened to be the fastest pace in 8 months. The article speaks further on how the word recession is the wrong way to look at the first quarter of 2019. Inevitably the first quarter tends to be a bit slower growth than most, so this is not a large alarm.
I thought this article was interesting as it feels that so many people are referring to our economy moving toward a recession, but this article has a different view on it. Good read.
Link to the article:
https://www.cnbc.com/2019/03/08/stalled-job-growth-could-be-warning-of-slowdown-but-no-signal-of-recession.html
2 comments:
I also thought that the slowed growth rate is not a recession. It's just part of the economic cycle that "naturally" happens. The BOG also is viewing the economy attentively and are sticking to their policy of keeping the interest rate increase as is. For now I agree that the economy is not at a problematic situation. The consumer confidence index declined but the numbers were inflated because of Christmas and New Years. However looking at the housing rate increase, things are still stable.
Great article, Antonio. I feel as though this idea of a recession coming in the near future has been tossed around for a couple of years. I wonder if it is a fear people have due to some economic indicators such as slowed growth. It is interesting that job growth has slowed down given the big increase right after the government shutdown ended. Overall, I do not think we are going to have a recession anytime soon, it seems as though many people are fearing recession given the slow growth, which has happened a good amount within the last couple of years and we have been to bounce back. It will be interesting to see what happens in the next couple of quarters though.
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