Americans fear recession as low unemployment links to economic downturns, intensified by alarming job market.

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A staggering 96% of Americans express deep worry about the current economic landscape, according to a survey by Intuit Credit Karma. The surprising link between low unemployment and imminent recessions is now causing widespread anxiety. While historically, a low unemployment rate signals a robust economy, recent data challenges this notion.

Former Treasury Secretary Janet Yellen highlighted the dichotomy, stating, “You don’t have a recession when you have 500,000 jobs and the lowest unemployment rate in more than 50 years.” However, a closer look at the chart reveals that unemployment often hits a cyclical low just before a recession hits.

In a shocking twist, full-time workers plunged by 1.5 million in a single month, hitting the lowest point since February 2023. Simultaneously, part-time workers soared by 762,000, reaching a record high. The number of multiple jobholders hit an all-time high at 8.565 million, while temporary jobs plummeted. The housing market strain is so severe that divorced couples are forced to continue cohabiting, as reported by the Wall Street Journal.

Moreover, a critical ISM Services report today unveiled an alarming employment index drop to recessionary levels. Despite better-than-expected job numbers, historical trends indicate that once the unemployment rate surpasses its 2-year moving average, a recession typically ensues. As labor markets deteriorate, the appeal of hard assets rises, emphasizing the need for careful consideration in these uncertain times.

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