The Labor Department’s monthly jobs report, out Friday, is likely to show U.S. employers hired fewer workers last month than in May, and economists say the slowdown could serve as the latest recession cue.
Economists surveyed by Refinitiv predicted the report would show 268,000 nonfarm jobs added to payroll in June, which would be the slowest in more than a year and less than 390,000 the month before.
The labor market – along with the economy in general – is expected to cool as the Federal Reserve continues its campaign to raise interest rates in an effort to combat roaring inflation, which is now at a 40-year high.
JOBS STAY NEAR RECORD LEVELS
But there are growing concerns that the central bank could go too far in slowing down demand and plunge the US into a recession marked by two consecutive quarters of negative gross domestic product growth.
Some analysts are pointing to signs that a recession is already underway: Last week, the Federal Reserve Bank of Atlanta lowered its second-quarter GDP forecast to -2.1%.
The real-time economic measure known as GDPNOw is not an official estimate of growth for the quarter ending June, but if forthcoming measurements from the Bureau of Labor Statistics confirm that the economy contracted in the second quarter, it will meet the technical criteria. before a recession are met .
POWELL SAYS THERE IS NO GUARANTEE THE FED CAN REDUCE INFLATION WITHOUT DAMAGE THE LABOR MARKET
The National Bureau of Economic Research (NBER) will make a final determination as to whether the economy has entered a recession, which the bureau says is characterized by high unemployment, low or negative GDP growth, declining revenues and slowing retail sales.
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Initial jobless claims soared last week to a six-month high of 235,000, ahead of the estimate of 230,000 and signaling that the labor market remains tight but labor demand is cooling.
Megan Henney of FOX Business contributed to this report.