Economy is 'slowing in a good way,' Meredith College economist says

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Saturday, July 8, 2023
Economy is 'slowing in a good way,' Meredith College economist says
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The unemployment rate remained below 4% for the 17th consecutive month, the longest-stretch in more than 50 years.

Employers added 209,000 jobs in June, according to a report released Friday by the US Bureau of Labor Statistics. While it marked the 30th consecutive month of gains, it was slightly below economists' expectations.

"We are seeing the start of a turning point where the data came in lower than expected and the lowest since December 2020," said Dr. Anne York, an economics professor at Meredith College.

The report also noted downward revisions in both April and May totaling 110,000 jobs.

"Overall, I think this shows that our economy is still strong, it's slowing, but it's slowing in a good way that hopefully we get that soft landing that the (Federal Reserve) has promised us, and not a hard landing," said York.

As the Federal Reserve considers future interest rate hikes to curb inflation, the job market is a key indicator the Fed will review.

"The market is anticipating that the (Federal Reserve) will raise interest rates at their July meeting. However, we are not going to see those 50 and 75 basis point increases that we have before. I think at best, we'll see a 25-point basis point increase, and maybe some more pauses coming up," said York.

The unemployment rate fell to 3.6%, marking the 17th consecutive month it was below 4%, the longest-stretch in more than 50 years.

"The companies and the hiring authorities that are most successful in job searches are ones that are listening to the candidates in this candidate-driven market," said Taylor Myers, Senior Executive Recruiter with Management Recruiters of Raleigh.

Workforce participation for women ages 25-54 hit a record-high 77.8% in June.

"Historically, my placements over the past few years have typically been 50/50 male versus female. And looking at my placements this year, the first six months of 2023, over 85% of my placements have been female," Myers explained.

Last month, Swati Landge, who moved to the US for her husband's work in 2014, landed a job with the United Way of North Carolina.

"I'm happy that I got this opportunity which is hybrid," said Landge.

Landge received work authorization just a few months prior to the pandemic; she highlighted some of the points she looked for in a position:

"Work-life balance, but benefits are also important, particularly medical insurance, 401K plan and (time off)," said Landge.

Landge credited her experience with Dress for Success Triangle NC in helping her navigate the search for work.

"Prior to Dress for Success, I was struggling by myself, preparing the resume, the LinkedIn profile. But when I got support, from (others in a similar position). Working with them, I felt more and more confident," said Landge.

Government, healthcare, social assistance and construction were the four industries which saw the largest gains. Hiring in construction has drawn increased attention in the Triangle, which has seen a sharp rise in home prices in the midst of a surging population.

"The lack of affordable housing can be a barrier for people coming to an area and taking jobs. So building that housing not only creates good jobs in the short-term, it means good construction jobs for example. It also means that you're attracting longer-term the workforce that you need to an area," said Bharat Ramumurti, Deputy Director of the White House Economic Council.

The retail industry saw the largest job drop in June, shedding 11,000 jobs.

"That could also be an indication that consumer spending is starting to slow, that consumers need to watch their wallets a little more than they have been," said York.