Manufacturing layoffs signal an impending spike in unemployment rates.

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Let’s talk about a crucial indicator in the economy – manufacturing. Recent data suggests that the manufacturing sector is still contracting, and this could have significant implications for the job market.

According to Jeffrey Gundlach, CEO and Chief Investment Officer at DoubleLine, there’s a concerning trend unfolding. He points out that average weekly hours worked in manufacturing are declining rapidly. And as history often repeats itself in economic cycles, Gundlach warns, “First, they cut the hours, and then they cut the bodies.”

This is a stark reminder of how quickly unemployment can soar, especially when manufacturing layoffs begin. The unemployment rate has a tendency to spike rapidly during economic downturns. Just take a look at the past 70 years – every recession has shown a similar pattern.

At first glance, the unemployment rate may seem subdued, but when the downturn hits, it hits hard and fast. This is something we need to keep a close eye on as we navigate the current economic landscape.

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