Preston Mui

An earlier version of this piece erroneously attributed this to the wrong author. The author is Preston Mui. Last Friday, we learned that the unemployment rate in August 2023 increased to 3.8% to 3.5%. The employment-to-population ratio was flat at 60.4%, and labor force participation increased to

The August 2023 labor market data points to a labor market that, while strong and not recessionary, is certainly slowing down more starkly than earlier this year. The headline unemployment rate increased to 3.8% from 3.5%, and the establishment survey showed 187,000 jobs added in August (albeit

In a recent Barron’s article, I examined why last year’s predictions that fighting inflation would require an increase in the unemployment rate went so wrong. The flaws in these predictions can be traced back to three ideas: first, that vacancies are a good measure of labor market tightness; second

The July 2023 labor market data continues to confirm the story we’ve been telling for months: while slowing down, the labor market remains strong, with high levels of employment amidst a disinflationary environment. The headline unemployment number fell to 3.5% from 3.6%, consistent with our preview, and

The data from the June labor market shows continued strength in the labor market, with strong employment and wage growth. The headline unemployment number fell to 3.6% from 3.7% and the establishment survey showed a solid 209,000 jobs added in June, consistent with our preview. While below

One argument that the labor market is to blame for high inflation has been the significant rise in unit labor costs during the post-pandemic recovery. The most recent example comes from the ECB:

Throughout the pandemic recovery, high inflation has been attributed to tight labor markets and high wage growth. Fed officials have, for months, maintained that the labor market needs to soften in order to bring down inflation. Commentators have pointed to high wage growth as a source of cost-push inflation: My

One popular narrative thread throughout the post-pandemic labor market was the “Great Resignation.” During the recovery, workers have been quitting their jobs at rates never seen before in the data. Many explanations have been proffered for this phenomenon, such as changing life priorities, workers reevaluating what they want out of

The data from the May labor market shows continued renormalization of the labor market, with strong employment, continued slowing of wage growth, and reduced churn.