Turbulence in the United Kingdom
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This Week on Recruitonomics:?
Turbulence in the United Kingdom
It’s been quite the week for the United Kingdom. The country faces a frighteningly tight labour market – job losses from the pandemic have not completely recovered and some workers are missing from the market. A cost-of-living crisis initially caused by skyrocketing energy prices continues to impact consumers. Amongst all this, new Prime Minister Liz Truss and Chancellor of the Exchequer Kwasi Kwarteng released a mini-budget that had massive effects. The chaos created by this plan has been dramatic and unlike anything the U.K. has seen in years.?
Read the full article here.
Retail Sector Responds to Uncertainty?
Retailers face uncertainty heading into the holiday season, which will impact their seasonal hiring goals. Nominal inventories are growing quickly, and a rapidly growing inventories-to-sales ratio leaves little margin for error. Consumer demand continues to shift from goods to services, and gifts this holiday season may reflect this shift. Finally, inflation is challenging shoppers – retailers expect subdued demand as rising prices force frugalness. The retail sector leads the seasonal hiring charge, and decreased demand in the sector will transform the cycle.?
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The Fed's Pessimistic Outlook for 2023
Slower growth and higher unemployment – these are the main projections for the economy in 2023 and beyond from the Fed’s Summary of Economic Projections. Tackling inflation requires raising interest rates to slow the economy, which has unsavory consequences. Unemployment is expected to rise from its current 3.7% to 4.4% in 2023. The same projections anticipate GDP to grow by a lackluster 1.2%. But, these numbers are hardly set in stone – a cool down in the labor market could also come from declining job openings.
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Last Week on Recruitonomics:
领英推荐
Seasonal hiring is upon us, but this cycle may not be as intense as years past. After a robust hiring iteration in 2021, demand for workers may be subdued in both warehousing and retail. Consumer demand has steadily shifted away from goods to services, which will certainly continue as the holidays approach. Retail and warehousing are especially impacted by this shifting demand. These two sectors normally drive the seasonal hiring rush, so decreased labor demand will certainly shape the rest of the seasonal cycle.?
Read the full article here.
Coming Up From Recruitonomics:
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What Recruitonomics is Reading:
After enjoying nearly four decades of low inflation, the rich world is now grappling with unexpected side effects. Some things taken for granted during this period – such as seemingly unlimited deficits – may be harder to maintain during a regime of high inflation:
“It’s tempting to see the market backlash against the British government’s proposed income-tax cut as a uniquely British problem.
That would be a mistake. The markets are sending a deeper message: It’s a more dangerous world for deficits.
Before the pandemic, depressed private investment and demand kept inflation too low for central banks that targeted 2%. In that world, government deficits helped by putting upward pressure on inflation. This also tended to push up interest rates, not a bad thing when central banks worried more about rates being stuck at zero. The upshot was that, as far as markets were concerned, governments’ capacity to borrow was infinite.
That world is over,” writes Greg Ip for the Wall Street Journal.
?More Data & Insights:
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