Latest / Markets with Megan: A Quick Financial Markets Update / 032: Understanding the Monthly Jobs Report 08-04-23

Transcript

032: Understanding the Monthly Jobs Report 08-04-23 · Markets with Megan: A Quick Financial Markets Update

• 0:03
  Megan Horneman: Hello, welcome to Markets with Megan.
• 0:05
  Megan Horneman: I am Megan Horneman, the Chief Investment Officer for Verdence Capital Advisors.
• 0:09
  Megan Horneman: We're going to come to you today talking about the monthly jobs report that we got Today.
• 0:14
  Megan Horneman: The equity market is enjoying what we saw in the labor market report this morning.
• 0:19
  Megan Horneman: I'm going to break it down because the headline you'll probably see is that it was not too hot, not too cold.
• 0:25
  Megan Horneman: Meaning that from the good parts of this report were that the unemployment rate did dip a tenth lower now to 3.5% Earnings.
• 0:36
  Megan Horneman: If you look at average hourly earnings, they were slightly better than expected.
• 0:39
  Megan Horneman: And then, when you look at the underemployment rate this is an employment rate that looks at those people that are working part-time but would like to work full-time that actually dipped lower as well.
• 0:51
  Megan Horneman: So that's the good out of this.
• 0:52
  Megan Horneman: You're going to get a lot of the markets obviously liking this report today.
• 0:57
  Megan Horneman: The unemployment rate is very low, but let's delve in a little bit deeper, like we like to do on this podcast, and look at some of the things that are starting to show further cracks in the labor market.
• 1:07
  Megan Horneman: It was the slowest two months of job creation that we've seen since December of 2020 and January of 2021.
• 1:15
  Megan Horneman: When you look at weekly hours, they ticked lower.
• 1:19
  Megan Horneman: Typically companies will cut the hours worked before they cut the employee.
• 1:24
  Megan Horneman: And then lastly, the temporary workers.
• 1:27
  Megan Horneman: This is something we've been watching closely because it historically has led to an eventual rise in the unemployment rate.
• 1:33
  Megan Horneman: Temporary workers have declined for six consecutive months and it's actually the worst 12-month rolling 12-month temporary workers we've seen since the pandemic.
• 1:43
  Megan Horneman: Again, that typically does lead on some uptake on unemployment rate.
• 1:49
  Megan Horneman: So again, the market's liking it today because the Fed is likely going to stay on hold now in September.
• 1:54
  Megan Horneman: There's no rush for them to hike rates.
• 1:56
  Megan Horneman: But you're getting a little bit of that.
• 1:58
  Megan Horneman: Not too hot, not too cold.
• 1:59
  Megan Horneman: The Fed can stay on hold and the equity markets are enjoying that report today.
• 2:03
  Megan Horneman: If you have any questions or comments, please feel free to reach out to a podcast at verdence dot com.
• 2:09
  Megan Horneman: Thanks,