Over at Angrybear, we note that employment per the household survey fell enough to push the employment to population ratio down to 63.0%. My hope is that the FED decides to lower interest rates.
Unlike pgl I don't have any hope that the Fed will reduce rates anytime soon and demonstrate their irrelevance.
Leisure and hospitality services are provided by the poor for the rich (It's my high nutrient breakfast that provides me such gems.) and given the increasing disparity, this looks like a self-terminating rather than a growth industry to me. Private jets to those "undifferentiated destinations" and declining wages for servicers...offsetting somewhat the wages of the less numerous plastic surgeons whose skills are somewhat more polished...giving us that "gangbuster" labor market of an additional $0.04/ hr.
Tis incredible that with the almost daily announcements of large layoffs from major corporations, that smaller companies can find replacements in the service industry...for the shrinking middle class.
Tis.
Note that average hourly earnings growth has peaked and this is a very good leading - concurrent indicator of fed funds. It is looking more and more like it is just a matter of time till the fed eases.
Spencer: Agreed. But a matter of how much time is still hugely uncertain. They could ease in 2 or 3 months... but it could be another 9 or 12, depending on whether the current softening trend continues or is reversed.
The more I look at those series for professional services and leisure falling, the more it looks to me like a good reason to worry about the economy.
Late to the party, but...
If you look back over the past few cycles, the Fed has eased in the same month as the peak in y/y hourly earnings gains, a couple of months after the peak, and 5 months after the peak. We are now 5 months past the peak for this cycle, assuming earnings don't accelerate again. So while I agree with Kash that the Fed is not on the verge of easing, the timing Kash suggests (2-3 months vs 9-12) is not what is suggested by hourly earnings. Right now is what is suggested by hourly earnings.
Commenting by HaloScan
