A roaring economy and a recession, simultaneously: the latest US jobs data is all over the shop

While the consensus appears to be that the latest US jobs data is extremely strong, a thorough analysis reveals major contradictions, with a suite of downright recessionary indicators also seen.

Executive summary

• While most market commentators and economists appear to have taken the view that the latest US jobs data paints an extremely strong picture, a deeper look at the data also reveals a suite of indicators that point to outright recessionary conditions.

• Key positive points to note, include:

  • Nonfarm payroll growth was revised far higher in December and remained strong in January (average MoM growth of 343k over the past two months);

  • Higher nonfarm payroll growth was boosted by private sector hiring, with 3-month moving average growth surging to its highest level since November 2022;

  • Higher private sector nonfarm payroll growth was supported by a significant increase in the breadth of manufacturing and private industry subcomponents reporting job growth; and

  • Both the unemployment rate (3.7%) and layoffs, remain historically low.

• Key negative points to note, include:

  • Household employment growth has plunged to just 0.8% YoY (note that this excludes the impact of the January populati…