In this episode, Scott Becker discusses the sharp drop in private payroll growth for May, with only 37,000 jobs added compared to the 114,000 expected.
Chapter 1: What happened in the job market in May?
Chapter 2: How do recent job additions compare to expectations?
This is Scott Becker with the Becker Private Equity and Business Podcast. We'll come to you today with three different podcasts. This is the first short episode. This episode is called The Job Market Implodes in May. So here's the deal. What happened in May is the U.S. economy, private payrolls added 37,000 jobs. This is less than the 60,000 in April.
Chapter 3: What role did government payrolls play in job growth?
And it's a heck of a lot less than $114,000 that people expected, that analysts and economists expected. You're also in a situation where the federal government is not doing what it did under the Biden administration, which is adding so many jobs that you couldn't really tell if private payrolls were being grown, government payrolls were being grown, or where the growth was coming from.
So the fact that the market imploded, and we'll get an unemployment rate soon, offsets yesterday's information that job openings had risen more than expected. Now, what does this mean? It means a lot of different things. It could at some point potentially mean a recession. And I'm not so sure that that's unlikely. But also, it means that the markets are taking this news in stride.
They view it as not a disaster, but a further signal that Chairman Powell will at some point need to reduce interest rates. So the markets are taking this quite in stride, notwithstanding the negativity of so few private payroll jobs being added. Another comment on this, some of the The talkers, the public speakers are saying that this is hiring hesitancy based on uncertainty of the economy.
We'll see how that goes. We'll see if that ends up being that sort of this uncertainty or if it really means that people are going to be much more careful about hiring. In any event, the job market implodes today. Let's see how this goes. Thank you so much for listening to the Becker Private Equity and Business Podcast.