“Curtailed.”
That’s job creation among private sector employers in the US, and that’s not my word. Rather, it’s Nela Richardson’s word. Richardson is, of course, chief economist at ADP.
I’m still not entirely sold on the utility of ADP’s weekly private payroll updates. I can’t decide if they’re more signal or noise, and the fact that the numbers are released on a two-week delay kinda defeats the purpose. The point, ostensibly, is to give markets a “real-time” read on private hiring. This isn’t real-time data. Not even close.
Anyway, Tuesday’s updated showed the four-week average ADP uses as a trend barometer downshifted meaningfully in the period ended November 8.
As the figure shows, private employers shed an average 13,500 jobs per week during that stretch.
“Consumer strength remains in question as we enter the holiday hiring season, which might be playing into delayed or curtailed job creation,” Richardson said Tuesday.
It seems fairly obvious the US labor market’s actively deteriorating. The headline hiring print for September from the BLS shouldn’t be anywhere near the top of Fed officials’ list when it comes to decision calculus inputs for the December policy meeting.
Even if the Committee wants to put a lot of weight on that hopelessly delayed BLS report, they surely noticed the jobless rate nearly rounded to 4.5%, and was anyway the highest since 2021.
As the figure below shows, the market-implied odds of a cut on December 10 came into Tuesday at roughly 85%.
Those odds were as low as 25% (a little higher, actually) just a week ago. A cut at the year’s final meeting was priced as a foregone conclusion prior to 2025’s penultimate policy gathering in October.
Chris Waller’s ready to go, that’s for sure. “My concern is mainly the labor market,” he told state television on Monday. “I’m advocating for a rate cut at the next meeting.”
Poor guy. He still thinks he might get the Chair nod.
“State Television” LOL. I’m forced to watch it when I go to the gym…gets my heart pumping more than the stair master.
For those of you who missed it here is the quote. ‘When asked what Bessent is seeking as he helps narrow President Donald Trump’s list of potential Federal Reserve chairs, Waller said he believes “they’re looking for somebody with merit, experience and a strong grasp of the job, and I think I fit that bill.” ‘
Sure feels like steering the economy is about as easy as steering a freighter through the fog by a rocky shore with no radar or compass. Somehow the nirvana we’ll achieve when AI fully blooms seems less likely when we can’t get timely and accurate information about the economy. Shame on Musk and his silicon valley ilk that they couldn’t speak truth to power after ingratiating themselves through extravagant gifts to the ruling family. Instead of DOGE going after the working class trying to keep our bureaucracy hitting on at least two cylinders, they could have focused their self proclaimed AI miracle processors on developing data feeds that are actually useful in critical economic decision making. It’s not too late to turn Trump’s Big Beautiful Ballroom into the White House AI nerve center. Pay Big Balls enough and you might be able to lure him to run it. One caveat, the Rose Garden (no idea what it’s called now) would have to become a skate park…and why not.
Is a cut really this much of a lock? I haven’t been keeping a scorecard of which fed member said what but that seems like a manic swing in odds