A shockingly soft labor report reignited Wall Street’s recession fears, but Corporate America might be telling an entirely different story—one that shows signs of strength not seen in years.
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The July nonfarm payrolls report came in far below expectations. The U.S. economy added just 73,000 jobs, while private payrolls rose 83,000—both short of Wall Street’s already-muted forecasts of 110,000 and 100,000, respectively.
Making matters worse, prior months saw a downward revision of 258,000 jobs, marking the largest two-month revision since 1968, excluding recessions, according to Goldman Sachs economist Jan Hatzius.
The unemployment rate ticked up to 4.2%, adding to fears that the labor market may have stalled in May and June.
Hatzius said this latest data aligns payroll numbers with other big-data indicators, marking “a confirmation that growth has slowed in recent months”
Is the Labor Market Really Signaling a Recession?
Not everyone agrees this is a recessionary signal.
“Friday’s jobs report was terrible with recessionary level numbers, but slowing hiring is not new and markets are already looking past it,” said Robert Ruggirello, CIO at Brave Eagle Wealth Management. He added that companies are …