The employment situation release for December 2022 provides latest available monthly data on the economy’s conditions. Here’re a variety of labor market indicators:
Trade Deficit Shrinks Dramatically: Interpretations
The trade balance [November release] rose to -$83.3 billion vs. Bloomberg consensus of -96.3 billion. The goods trade deficit with China also shrank sharply.
Lumber Prices near Consumers
Futures prices and PPI have come down (see here). The question is whether the consumer (say a house builder) has seen comparable price decreases. Here are two pictures that suggest they have.
Wells Fargo: “Nonfarm Payrolls: Too Good to Be True?”
From House and Pugliese at WF today:
- The buoyancy of nonfarm payroll growth has seemed at odds with other signs that the jobs market is beginning to sour. …
- Yet the jobs market is hardly falling apart. A holistic look at the data suggests that directionally the labor market is weakening, but at a measured pace and from a remarkably strong starting point. Not only do signals of demand remain strong on an absolute basis, but job switching remains elevated and the unemployment rate remains exceptionally low at 3.7%.
The Jobs Worker Gap in November [Updated to December]
[Updated to include December data] Late to the commentary, here’s a picture of the jobs-workers gap for November, based on JOLTS data:
ADP Release, and the Flat Employment Growth in Q2 Thesis
The relatively volatile household survey employment series and the Philadelphia Fed’s estimated preliminary benchmark adjusted series suggest flat employment in Q2 (although NOT in H1); see graphs in this post. The ADP release on private nonfarm payroll (NFP) employment today (surprising on the upside 235K vs 150K consensus) suggests otherwise, when taking into account the relatively small change in government employment over the relevant period.
Coincident Indicators of Recession: VMT, Heavy Truck Sales, Sahm Rule
Ever wonder whether vehicle miles traveled (VMT) does a good job of predicting recessions. Wonder no more. First take a look at what VMT does over recessions, versus heavy truck sales (suggested by Calculated Risk at some points), and the eponymous Sahm Rule (real time version).
Business Cycle Indicators at 2023’s Beginning
Monthly GDP for November is out. Q4 tracking is for q/q growth 2.1%-3.9% (SAAR).
Lumber Prices and Lumber Futures
Lumber prices did drop like a rock in Fall 2021 (which JohnH seems to deny); then back up. Then back down.
One Year Ahead Inflation Expectations, January 2023
Down slightly in November.