In a sobering turn of events, the month of December witnessed the @Conferenceboard Leading Economic Index marking its 21st consecutive monthly decline, teetering on the edge of a streak reminiscent of the early 1970s. Adding to the economic unease is California’s unemployment rate, now standing at 5.1%, contributing to the broader concerns for both the nation’s economic landscape and the decisions made by the Federal Reserve.
The distinct split between the bullish and bearish sentiments is glaring, with proponents of a perpetually positive market outlook facing skepticism. The data released in December reflects a state-level unemployment scenario that only adds to the string of bad news emanating from household surveys.
A notable figure in economic analysis, the Sahm-Rule indicator, updated after a significant hiatus, is showing signs of intensifying concerns. In fact, it has now surpassed the threshold that historically marked the onset of every recession since the 1970s. Throughout December, a noteworthy 20 states, representing 39% of the total charted below, triggered the Sahm Rule, signaling a significant shift from just three states in September.
Furthermore, last November saw nearly 25% of states triggering the Sahm Rule, particularly as layoffs were increasing in sectors like Tech, Real Estate, and Finance. However, these figures subsequently tapered off, pivoting sharply lower just below the threshold typical for recessions.
The economic landscape is further complicated by significant layoffs at major corporations. eBay, a prominent online marketplace, announced plans to lay off 1,160 employees, constituting 10% of its workforce. Similarly, Google is making workforce adjustments, laying off 225 employees in New York.
These developments paint a complex picture of economic indicators, corporate decisions, and the overall sentiment in the business world. As we navigate these turbulent waters, the uncertainties ahead underscore the importance of vigilance and comprehensive analysis to grasp the full extent of the economic landscape and make informed decisions moving forward.
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December decline in @Conferenceboard Leading Economic Index marked 21st consecutive monthly drop … one month away from reaching streak during early 1970s pic.twitter.com/VhJxz2Vrp4
— Liz Ann Sonders (@LizAnnSonders) January 23, 2024
Cal unemployment now at 5.1%. Leading the way for the US as a whole? And for the Fed. t.co/lCK6vsrZAM pic.twitter.com/eLrcWVGiXE
— PPG (@PPGMacro) January 24, 2024
State-level unemployment rates were just released and they continue the string of bad news from the household survey.
It's been a while since I've refreshed this dataset and now my updated state-level Sahm-Rule indicator is really heating back up – in fact, it's now above the… pic.twitter.com/yQheUTltO9
— Parker Ross (@Econ_Parker) January 23, 2024
eBay to layoff 1,160 employees, 10% of their workforce
— MacroEdge (@MacroEdgeRes) January 24, 2024
Google is laying off 225 employees in New York
— MacroEdge (@MacroEdgeRes) January 23, 2024