Remembering (or Not) the Recession of 2022H1

Compiling a bunch of labor market data, we have the following picture of the private nonfarm labor sector, which seems to run counter to the argument last made a month ago that a recession occurred in 2022H1.

Figure 1: Private nonfarm payroll employment from January 2023 CES release incorporating benchmark revisions (blue), from December 2022 CES release (sky blue), ADP (pink), CES aggregate weekly hours for production and nonsupervisory workers (light green), QCEW private covered workers, seasonally adjusted using log transformed Census X-13 (red), Philadelphia Fed preliminary benchmark minus reported government employment (tan squares), Philadelphia Fed coincident index (chartreuse), all seasonally adjusted, in logs 2022M12=0. A hypothesized recession shaded light gray. Source: BLS (various) via FRED, BLS QCEW, Philadelphia Fed via FRED, and author’s calculations.

Note: January 2023 CES private NFP incorporates benchmark revision to data incorporating March 2023 QCEW data, and new seasonal factors. QCEW is an census which has almost complete coverage, reported up to June 2022 (but will be revised), but has to be seasonally adjusted to make it comparable to the other series. The aggregate weekly hours variable is not independent source from the other CES survey data based estimates — it will in principle equal employment times average weekly hours. The ADP series is based on completely different data than the BLS series. The Philadelphia Fed has a benchmarking process which accesses some of the BLS data but not all, in order to make a more timely estimate. Finally the Philadelphia Fed coincident index uses the Stock-Watson dynamic factor approach to applied to primarily labor market data (including wage and salary disbursements) to infer the level of economic activity.

25 thoughts on “Remembering (or Not) the Recession of 2022H1

  1. Macroduck

    Off topic, The Adani Enterprises slide is causing talk of contagion by someone other than me:

    Adani shares ended the day up slightly after a 35% drop at one point during the day. Trade was halted twice today. No idea who did the buying. The family owns 55% of shares, which limits risk to the rest of the world somewhat. Boris Johnson’s brother, Jo, has resigned from his directorship at Adani. Adani, the man, is closely tied to Modi.

    As is always the case with individual firms, I don’t give two hoots about Adani itself. I don’t work for ’em, I don’t own ’em and I don’t short. India is, however, the 6th largest economy and grew faster than both the U.S. and China last year. My limited knowledge of Indian finance prevents me from making a reasonable assessment of contagion risk. Smoke => Fire? Best I have.


      The.contagion is to the Pound and nondollar assets related to pax Britannia. Might be the final collapse of the common market. Most of India’s GDP is not based on dollars, but pounds. United Kingdom disintegration is looking more likely by the day.

    2. pgl

      “Adani Group said on Thursday (Jan 26) that it is evaluating “remedial and punitive action” under United States and Indian laws against short-seller Hindenburg Research, which in a report accused the conglomerate of improper use of offshore tax havens.”

      Going after Hindenburg Research is not exactly cleaning up the corrupt behavior of Adani Group management. I just wish Hindenburg Research warned us about the corrupt behavior of US companies such as Bed Bath and Beyond or Toys R Us. We need more of their research not lawsuits against them.

    3. pgl

      On January 24th, we released a report outlining numerous issues of suspected fraud at the Adani Group, the 2nd largest conglomerate in India run by the world’s then-third richest man. Hours ago, Adani released a ‘413-page response’. It opened with the sensationalistic claim that we are the “Madoffs of Manhattan”. [1] Adani also claimed we have committed a “flagrant breach of applicable securities and foreign exchange laws.” Despite Adani’s failure to identify any such laws, this is another serious accusation that we categorically deny. It also predictably tried to lead the focus away from substantive issues and instead stoked a nationalist narrative, claiming our report amounted to a “calculated attack on India.” In short, the Adani Group has attempted to conflate its meteoric rise and the wealth of its Chairman, Gautam Adani, with the success of India itself.

      We disagree. To be clear, we believe India is a vibrant democracy and an emerging superpower with an exciting future. We also believe India’s future is being held back by the Adani Group, which has draped itself in the Indian flag while systematically looting the nation. We also believe that fraud is fraud, even when it’s perpetrated by one of the wealthiest individuals in the world. In terms of substance, Adani’s ‘413 page’ response only included about 30 pages focused on issues related to our report. The remainder of the response consisted of 330 pages of court records, along with 53 pages of high-level financials, general information, and details on irrelevant corporate initiatives, such as how it encourages female entrepreneurship and the production of safe vegetables. Our report asked 88 specific questions of the Adani Group. In its response, Adani failed to specifically answer 62 of them. Instead, it mainly grouped questions together in categories and provided generalized deflections. In other instances, Adani simply pointed to its own filings and declared the questions or relevant matters settled, again failing to substantively address the issues raised. Of the few questions it did answer, its responses largely confirmed our findings, as we detail. But before we get into those, we note that the core allegations of our report – focused on numerous suspect transactions with offshore entities – were left completely unaddressed.

  2. Macroduck

    Way off topic, Civilization States and Liberalism –

    I know, I know. I’m once again slopping my little hobby into our hosts’ comments section. However, just beneath the surface of some disputes which come in for lots of discussion here is a rejection of a single liberal, rationalist norm. International rules of trade, Law of the Sea, Universal Human Rights, all bunk. China’s expansionism is justified with the idea that China’s is an historic civilization which supercedes rationalism and a liberalism based on rational foundations. Russia’s claims are cruder, but similar.

    Post-WWII arrangements, however flawed, aimed at establishing rationally-based liberal foundations. Reject liberalism and you tear down the current order. But not in China. China never adopted liberal institutions. Problem is, China as a model for the entire belt-and-road/South China Sea market amounts to revolution. We know how those tend to go.

    The idea of a Civilization Nation is not new. Johann Herder argued against the rationalism of his teacher, Kant, in favor of a subjective, culturally-based volk romanticism. The result was Goethe, Gothic literature, folk-themed classical music and National Socialism.

    Anyhow, I found this interesting. I imagine a handful of others here will, as well. The title gives the gist:

    1. Anonymous

      something popped up this am

      usa talks about a rules based world order, with their rules……

      what about the un, its charter, and asking whether the general assembly or security council might have some authority wrt international rules.

      just ruminating….

      about gunboat rules.

    2. Ivan

      Societies as a concept have developed to a post-nation stage but the little monkeys in clothes living there, have not (yet?).

      In modern society the absurd focus on grabbing territory and resources is way past the practical advantages of doing so. Societies can purchase anything that is not found on the land they control. Sure it may cost some to purchase what you need, but much less than the cost of taking over and then controlling a territory that is not welcoming. Todays power is transnational. Not as in nutcase “UN is controlling us”, but as in “any billionaire can move to whatever country provides the best nesting place”. Even more important “any brilliant and creating individual can move to the best nesting place”. Nationalism is for morons and losers – unfortunately they often end up taking territorial power (because they are to dumb to understand how useless it is to be in control of land).

    3. JohnH

      Another view of the liberalism of the West: “The history of World War 1 continues to be eerily relevant today. In 1928, the leftwing British war resister Arthur Ponsonby published a book titled Falsehood in War-Time, Containing an Assortment of Lies Circulated Throughout the Nations During the Great War. Its lessons have massive relevance, that continues until today. In 2001, a leftwing Belgian philosopher called Ann Morelli codified the main themes of the pro-war propaganda Ponsonby had identified into a 10-point list as follows:

      We do not want war.
      The enemy alone is to be blamed for the war.
      The enemy is inherently evil, resembling the devil.
      We defend a noble cause, not our own interest.
      The enemy commits atrocities on purpose; our mishaps are involuntary.
      The enemy uses illegal weapons.
      We suffer small losses, those of the enemy are enormous.
      Artists and intellectuals back our cause.
      Our cause is holy, it has a sacred character.
      Whoever doubts our propaganda, is a traitor.

      How startlingly timely is this today?”

      The West trumpets its “liberalism,” forgetting that the major Western nations were all once colonial powers, dominating and oppressing “illiberal” societies. For many former colonies, domination and oppression have morphed into other forms using leaders selected from native oligarchies whose backs the colonial oppressors cover. But, hey, if the propaganda makes MacroDuck feel good about his patriotism, that’s all that counts!

      1. pgl

        I’m a little surprised that you did not add:

        Germany never invaded France or Russia.

        Hitler was a wonderful human being.

        Putin’s war crimes in Ukraine get little Jonny boy all excited.

        1. JohnH

          You have to marvel at pgl’s incredible ability to be illogical. I say that I hate propaganda and being BSed. From that pgl deduces that I love the enemy!!!

          In pgl’s black and white Manichaean world, you’re with us or against us. If you don’t embrace the part lie, you’re with the enemy. George Bush would have been proud of pgl!!!

          Speaking of US imperial behaviour, here’s how it’s threatening Serbia:

          “Should Belgrade refuse the ultimatum, it can expect the following:

          EU and US investment in the country evaporates.

          Serbia’s EU candidacy dies.

          A ban on lending by European banks, the European Bank for Reconstruction and Development, the World Bank and the IMF.

          Reprisals on ethnic Serbs in NATO protectorates of Kosovo and Bosnia and Herzegovina (violence flared up in such areas in Kosovo in the runup to the ultimatum).

          An increase in efforts to interfere in Serbia and install a “pro-Western” government.

          A reintroduction of visas.


          Seizure of assets.”

          Yet some laud the West for its liberalism!!! Of course, if you believe that liberalism means that might makes right, then I suppose the West could be seen as liberal. But you’d to be pretty Orwellian to fail to see how illiberal that attitude is!

          1. pgl

            Yea – you celebrate each and every Putin war crime. Don’t deny it Jonny boy. Otherwise Putin will not feed his little pet poodle.

          2. Noneconomist

            JohnH was/is a charter member of the Slobodan Milosevic fan club. No surprise since genocidal “leaders” lead the JohnH parade. So, JH, give us a little more yada about all those western liberal bad guys while raising a fist to murderous autocrats who—in JH world anyway—would never stoop to involvement in pointless wars or military misadventures.or poisoning their rivals.
            Yada on, oh great one.

  3. ltr

    February 4, 2023

    Gautam Adani’s Rise Was Intertwined With India’s. Now It’s Unraveling.
    The tycoon often said the Adani Group’s goals were in lock step with India’s needs. Now, the company’s fortunes are crashing, a collapse whose pain will be felt across the country.
    By Alex Travelli

    Gautam Adani began the year as one of the richest men who ever lived, an upstart billionaire whose conglomerate, one of India’s largest, had surged in value by 2,500 percent in five years.

    That rise, as he portrayed it, wasn’t his alone: It was inseparable from the “growth story” of India itself. His companies’ goals were in lock step with the country’s needs, he often said. Relying on his longstanding partnership with India’s powerful leader, Narendra Modi, he brought his private companies — spanning power, ports, food and more — into alignment with one politician more closely than any business titan before him.

    Now, in spectacular fashion, the fortunes of his Adani Group are crashing down even faster than they had shot up — a collapse whose pain will be felt across the country, rippling through its economic and political spheres.

    More than $110 billion in market value — roughly half of the Adani Group’s worth — has vanished in just over a week, like air from a burst balloon. The pinprick was a report by a small New York investment firm, Hindenburg Research, whose description of “brazen accounting fraud” and stock manipulation sent investors fleeing, just as the Adani Group was beginning a sale of new shares to investors, India’s biggest-ever secondary share offering.

    Adani wrapped itself in nationalism as a defense, calling the report “a calculated attack on India” and on “the independence, integrity and quality of Indian institutions.” Hindenburg retorted that Adani was waving the flag to obfuscate shady dealings, like the use of offshore shell companies to exaggerate its stocks’ valuations in order to paper over its excessively debt-fueled ascent.

    The debacle could damage confidence in the rest of the Indian stock market. At their peak, Adani shares accounted for more than 6 percent of India’s two main exchanges; today, the figure is barely 3 percent. More troublingly, Adani’s fall could jeopardize the idea of India as the world’s next great hope as a driver of global economic growth.

    Its government is facing questions about whether financial regulators were doing their jobs properly while the Adani Group threw off funny signals for Hindenburg to pick apart. The country’s chief regulator has had a sterling reputation in the three decades since it was empowered by a market-crashing stock scam. Now, the concern is that India’s financial oversight has bigger holes than believed, or that the politically connected Mr. Adani somehow got a free pass.

    1. pgl

      I recently checked out Apple Computer’s financials and its market value of equity was over $2.4 trillion. Just imagine the impact of having its market value fall by half!

      1. Moses Herzog

        “Just imagine” the party that same evening at “ltr’s” apartment if Apple did lose half its market value. I hope that was more a general comment than anything you thought “ltr” would fret over. Hahahaha. Funny. I wish I was drinking right now so I could actually laugh at that one.

  4. ltr

    “Civilization States and Liberalism…China never adopted liberal institutions.”
    “Civilization States and Liberalism…India never adopted liberal institutions.”
    “Civilization States and Liberalism…Israel never adopted liberal institutions.”
    “Civilization States and Liberalism…Brazil never adopted liberal institutions.”
    “Civilization States and Liberalism…Ethiopia never adopted liberal institutions.”
    “Civilization States and Liberalism…South Africa never adopted liberal institutions.”

    This is, of course, all profoundly mis-educated, false and morally offensive.

    Israel is a civilization state extending through 5,000 years of history just as India or China. Beyond even the Holocaust, Israel adopted liberal institutions.

    1. ltr

      February 1, 2023

      Exhibition tells stories of Holocaust survivors
      By Huang Lanlan

      Shanghai — To commemorate Holocaust survivors, the exhibition Displaced Persons and Displaced Persons Camps is currently being held at the Shanghai Jewish Refugees Museum in the city’s downtown Hongkou district, which sheltered thousands of Jewish refugees from Nazi persecution in the 1930s and 1940s.

      Set to run until March 10, the exhibition co-hosted by the United Nations and the museum shows visitors how Holocaust survivors relocated and rebuilt their lives with the help of the United Nations Relief and Rehabilitation Administration and people worldwide.

      About 20,000 European Jewish refugees came to Shanghai during WWII, taking long journeys to reach the city. While times were hard, they were able to survive and make a life for themselves thanks to the life-saving assistance of people of Shanghai.

      This remarkable feat was described by Holocaust historian David Kranzler as the “Miracle of Shanghai.”

      Together, the people of Shanghai and the Jewish refugees supported each other through thick and thin, and welcomed the global victory against fascism, museum curator Chen Jian said in a speech at the opening ceremony on Monday.

      “Today, this history is also a deep interpretation of the concept of ‘building a community with a shared future for mankind’ that we are advocating today,” Chen told the Global Times.

      At the ceremony, Consul General of Israel in Shanghai Ravit Baer expressed gratitude for Shanghai’s efforts in protecting the Jewish refugees and supporting the local Jewish community.

      “The strong Jewish community that developed here, often assisted by their Chinese neighbors in what became known as ‘Little Vienna,’ leaves a legacy that connects the Jewish and Chinese people to this day,” she said….

    2. Macroduck

      Liberalism and communitarianism are fundamentally different. Your knee-jerk rant is either “mis-educated” or simply dishonest.

      Morally offensive? Uyghers in concentration camps. Threats of violence against Taiwan. Oppression of dissent in Hong Kong. Millions dead in the Great Leap Forward.

      Great Leap Forward? There’s a model of marketing excess. The worst single famine in human history is a “leap forward”. Helps to understand ltr’s rhetorical peculiarities.

  5. ltr

    —– never adopted liberal institutions.
    —– never adopted liberal institutions.
    —– never adopted liberal institutions.

    [ Imagine such a terrifyingly false assertion about a people who sheltered Jews through the Holocaust, even as they themselves were being ravaged by a merciless invading army, a people who continue to memorialize and directly relate to the Holocaust, a people who have wonderfully managed to end severe poverty through a population of 1.4 billion, a people who as they develop extend themselves through Laos to Egypt to Namibia to Indonesia. ]

    1. ltr

      August 23, 2022

      LA’s Holocaust Museum mounts exhibit in honor of Shanghai’s welcome of Jewish refugees
      The exhibit honors this shared moment in history with emotionally gripping stories of survival and compelling displays of unique personal items of Shanghai’s Jewish refugees – some well off and others penniless with only the shirts on their backs.
      By Julia Pierrepont III and Zeng Hui

      October 6, 2022

      Chinese-built hydropower plant in Israel enters final construction stage

      The largest pumped storage power plant in Israel has entered its final stage of construction as the lower reservoir has been completed recently.

      The 344-MW Kokhav Hayarden pumped storage hydropower plant, built by Chinese company Power Construction Corporation of China (PCCC), located near the city of Beit She’an in northeastern Israel, is expected to be operational in early 2023.

      Featuring two reservoirs at different heights, both with 3.1 million cubic meters, the hydropower plant can operate at a water head of 500 meters….

      [ China knows and honors liberalism profoundly. ]

      1. Moses Herzog

        This welcoming of diaspora Jews was pre-1949, correct?? It’s a “yes” or “no” question BTW.

        1. pgl

          Between 1933 and 1941, as Nazi Germany occupied most of the Continental Europe and pushed eastwards into the Soviet Union, estimated 25, 000 Jewish refugees fleeing the Holocaust found refuge in the Chinese city of Shanghai – in the “Designated Area for Stateless Refugees” in Tilanqiao district of Shanghai. The Chinese port city was one of the few safe havens during the World War II that accepted Jewish refugees from across the world without requiring hard-to-get immigration visas. By the time the war ended, most of the Jewish inhabitants of the city had survived.

          pre-1949 as you noted.

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