Fed on Hold, Job Market Slows
Happy Friday, Brian Manning with the weekly update.
Let’s get right to it.
So first thing we want to talk about next week, Fall Fiesta. I cannot believe second Thursday, November.
It’s taking place November 13th. We got some incredible live music, open bar, all you can eat tacos, catered by McDivitt Tacos. We’re raising money for Community Food Share. It’s our annual event that we throw.
Help us support an incredible nonprofit that really helps people with a food insecurity in the Boulder County, Broomfield County area. If you have not RSVP’d and you want to come out, please do. This will sell out. We’re approaching sellout numbers right now. So we would love to have you there, but make sure you RSVP. This will sell out.
Let’s talk about the news of the week. So first, Monday of this week, we got information on active listings. So this is looking at real estate across the country. Active listings right now, we’re at a number
We’re at 1.1 million, still 9% below where the number was in October 2019. So really active listings are actually still below the pre-pandemic level.
So I know different markets have a finger on the pulse with what’s happening as far as inventory across the country, especially here in Colorado, but in its entirety, active inventory is still below pre-pandemic levels.
Then the big news this week was Wednesday.
So government shutdown, which means that we’re not getting any data.
The challenge with not getting any data and the government shutdown, of course, has its own slew of issues on its own.
But the big challenge for us here is that the Federal Reserve is going to make decisions on what they want to do with upcoming rate cuts potentially.
And the lack of data puts them in a position where they can’t make any decisions at all.
So with the lack of government data due to the shutdown, we’re very limited on what we can look at.
And right now we have ADP.
So ADP report came out, this is for the month of October. Expectations were already really low. It was expected that in October, we would have created 24,000 jobs in the entire country. And it came out that there was 42,000 job gains. Now, yes, that was a number that beat expectations.
But if you look at the entire country, you look at ADP, prior several months were negative job growth. And now you’re at 42,000, extremely limited number. This is kind of showing an anemic job market out there right now. It’s really unfortunate to see.
Then we look at what’s called the challenger job cover report and the hiring report. Again, because there’s a lack of data out there. Usually we’d be getting job reports from the BLS today. Now there’s a lack of data, so everyone’s going to look someplace else.
So this report doesn’t usually carry as much clout as it does right now, but looking at this report, this is for the month of October. I’m just looking at job replacement and it says in the month of October, there’s anticipated 153,000 less job hires across the country. So this is the lowest number, or this is the lowest October number, excuse me, in 22 years. Year to date, companies have said that they’re going to hire a million less people.
So hiring plans right now are also the lowest level across the country since 2009. Also, if we look at hiring, there’s a 35% decline in hiring plans. This is the lowest number since 2011.
When I look at media sources like, I don’t know, the Wall Street Journal, for example, you look at companies out there like Google, Amazon, IBM, all these companies across the country talking about their layoffs that are going to start taking place through their corporate division.
And companies out there like Walmart saying that we don’t have any hiring plans, that we actually think we can do more with what we have right now.
We’re going to utilize the teams that we have in place. We’re going to integrate AI into this, and we don’t plan on hiring any more people. What’s baffling to me is that all this data coming out, like low jobs report, slow hiring, 35% decline in job hiring, we still have Federal Reserve voting members out there that say the job market is good the job market is stable.
So I just can’t understand where that’s coming from. So speaking of the Federal Reserve, also very highly anticipated that in their December meeting coming up, there would be a December rate cut. This has actually been anticipated for several months now.
But one thing to know about the Federal Reserve is there’s a lack of data right now, like we’ve already been talking about. And when there is a lack of data, the Federal Reserve will not make any decisions. So now you’re seeing the probability of a rate cut in December severely decline because there’s no data coming out that the Federal Reserve can use to make a decision on.
Because remember, the Federal Reserve has two mandates. One is going to be price stability, so controlling inflation, and the other is going to be a stable employment in the U.S. economy.
And when you don’t have data coming out, you don’t know what’s happening with inflation or employment.
So now this rate cut that everyone anticipated in the month of December, I’m not going to say it won’t happen, but right now it’s looking like it definitely could be off the table.
I’m around all weekend. If you have any questions, let me know.
I’m available seven days a week, 8 A.m. to 8 P.m. Give me a call, shoot me a text.
Love to help you. Happy Friday.
Hope to see you all at Fall Fiesta.
Have a great day.
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