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Employment Outperforms But is Still Cooling

Dan North | May 2023

The April employment report was stronger than expected.

📉 The unemployment rate crept down from 3.5% to 3.4%, tying January's 54-year low, and the economy created 253k jobs vs expectations of 180k. Gains were widespread across industries, led by Education and Health Services. Banking-related industries lost -2.5k jobs. 

📰  However, the strong headline numbers do not tell the whole story. The prior two months were revised down a total of 149k, a very sharp decrease. In addition, job growth continues to slow. 

⬇  The 10year- 3-month yield curve continues its freefall. This is the bond market screaming at the Fed that it has gone too far, the banking system situation is nerve-wracking, and the debt ceiling issue is becoming quite alarming. 

Overall, the headline employment numbers were good, but the intermediate-term trends are distinctly negative. Read more from The North Report: 

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