There’s a disconnect in the Main Street data that is perplexing from the standpoint of traditional economic and labor analysis.
There have been significant layoffs in the labor market as the result of diminished consumer spending activity. However, the Bureau of Labor and Statistics (BLS) is reporting a hotter than expected 263,000 new jobs in November [DATA HERE].
There were declines in jobs within the retail sector [-30,000 in Nov, -62,000 since August] and declines in warehousing and transportation [-15, 000 in November, -30,000 since July], which would indicate the outcome of lowered consumer spending on goods, or at least a change in consumer spending priorities.
Simultaneously, there were significant increases in jobs for leisure and hospitality [+88,000 in Nov], with the majority of those gains in food service and drinking. However, that sector is still lower than the pre-pandemic by -980,000 jobs. Also note people are not attending events with high ticket costs, the performing arts and spectator sports segment dropped 7,000 jobs [Table B-1]
Overall, if you were to look at the macro level jobs report, anything attached to the traditional spending of durable goods (retail stores) is declining. However, the jobs related to the service or life experience are growing. Oddly, and perhaps creepily, this dynamic falls in line with the ‘you will own nothing and be happy‘ cliche’ that has been oft spoken about the new post pandemic ‘Build Back Better‘ economy as espoused by the World Economic Forum.
Job gains in the infrastructure of life such as, building and construction, as well as the labor sector associated with skilled domestic service trades like plumbing, electricians, maintenance, etc are continuing to hold stable. The major shift in the labor market surrounds the buying of durable goods which has disappeared along with the disappearance of discretionary income. Which brings us to the wage portion of the BLS report.
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