Another day, another headwind for the Federal Reserve’s fight against inflation. 🥵
This week the market is closely watching the December labor market data. And so far, the reported numbers have shown that it remains very tight.
Today’s ADP private payrolls report showed 235,000 jobs added in December, which blew past estimates of 153,000. Additionally, upward pressure on wages continued, with annual pay rising 7.3% YoY. 🤑
Service providers were responsible for 213,000 jobs, offsetting losses in trade/transportation/utilities, natural resources/mining, and financial activities.
On top of that, initial jobless claims fell back to 204,000, their lowest level since September, after hitting a three-month high earlier in December. Continuing jobless claims also fell to 1.694 million. 📉
While we’ll have to wait to see what tomorrow’s nonfarm payroll data shows, it looks like the labor market remains historically strong. With that said, that doesn’t mean there aren’t any layoffs. Today we heard about job cuts at Amazon, Cisco, and Helen of Troy today.
Lastly, the Federal Trade Commission (FTC) has proposed a new rule that would block employers from using non-compete agreements. The organization claims these types of restrictive covenants limit the employment prospects for tens of millions of Americans, which reduces wages and economic mobility.
The proposal is now open for public comment, so we’ll have to see where it goes. But it’s an interesting prospect nonetheless. 🤷