Up until recently the US job market has been strong. A 3.5% unemployment rate is the lowest in almost a half century. However, this good news may not last long.
To wit, here is a list of companies announced layoffs (in number or percentage of staff): Meta 11,000 (13%), Amazon 10,000, Twitter 3,700, Strip 1,100, Coinbase 1,100, Shopify 1,000, Lyft 700, Netflix 450, Robinhood (31%), etc.
What do businesses see that we don’t? Perhaps they are reacting to the Fed’s aggressive interest rate hikes in attempts to taming the inflation back to the target 2%. Currently it is at 7.75%. Cost of money is always a factor in company’s hiring/ firing decisions.
Perhaps the supply chain crisis caused by the Covid pandemic is lingering on? Or the current job market is boosted only by the holiday surge? In any event, a recession, by definition, is a significant decline in economic activity, lasting more than a few months.
What do you think about recession in the US?