I meant to post this yesterday and it slipped my mind, but given the US market holiday on Monday I think I got away with it!
Goldman Sachs economists' remarks on the US labor market:
- references to labor shortages in Russell 3000 earnings calls fell to the lowest level of the pandemic in Q4
GS says the peak they had was 16.5% in Q3 of 2021, this was down to 4.9% of earnings calls for Q4 2022
And add:
- several companies viewed the staffing situation as back to normal or nearly normal, including Hilton Worldwide, Yum! Brands (fast food chains), The Hershey Company, and Starbucks.
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A less tight labour market will, at the margin, reduce pressures for higher wages, and, again at the margin inflation pressures, and, yes again at the margin, pressure on the Federal Reserve's Federal Open Market Committee (FOMC) to hike rates. Don't go expecting massive rate cuts on the back of this though, OK?
