September job growth falls short of expectations, adding only 89,000 positions
But the economy is strong, man!
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Hello Financial Healers,
I've got some interesting news for you about the job market in the United States. And let me tell you… it’s not pretty.
One silver lining is the Bureau of Labor Statistics’s report, set to be released tomorrow, is predicted to give a more accurate analysis. Only question is… will the government’s report match the ADP’s independent research? Or will it differ greatly?
What is the ADP?
The ADP is a research firm that tracks labor market and employee performance. They release monthly findings based on their clients’s information and compiles this data into a monthly National Employment Report.
Last month’s findings showed that private sector employers added only 89,000 jobs, which differed from economists who forecasted a net gain of 170,000 jobs in September. The data marks the slowest pace of job growth ADP has seen since January 2021.
Now, it’s fair to say ADP’s findings have been off in the past. Economist Ian Shepherdson mentions ADP’s findings are unreliable. A spokesperson for the ADP acknowledged, “We’ve seen other times when we've had a relatively weak private sector number sandwiched between two stronger months. So it's still too early to call this a consistent slowdown in the labor market.”
But, if the research is that inconsistent, why is this story getting so much attention?
I think it’s because ADP validates the feelings so many Americans have — that the U.S. economy is not doing well.
With a fiery presidential election boiling up, fears about inflation and the economy are igniting the voter base.
But what interests me most is how government reports differ from the overall mood of many Americans. BLS says the economy is heating up, but independent firms like the ADP say the opposite. How can two different realities exist at the same time? Elisabeth Buchwald says it perfectly:
ADP’s latest report certainly gives the impression that the labor market is cooling as fewer people are getting hired.
But data from the Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey report for August showed the opposite with the number of available jobs unexpectedly bolting higher.
So how can the labor market be both cooling down and heating up at the same time? [You can’t have] a glass… half empty… [and] half full [at the same time].
I wonder if this discrepancy points to Americans finding themselves ill-equipped for new job openings. Perhaps advancements like AI are closing down certain jobs and disqualifying employment in other positions.
Regardless of what BLS says tomorrow, keep a careful eye on the U.S. economy. I expect the market to cool in the coming months, but it may even heat up. Who knows at this point, especially with a highly controversial presidential election coming up?
The best thing you can do is protect your home. Build up your savings (accumulate an emergency fund of at least $1000). Craft a plan to eliminate debt.
Work hard at gaining financial freedom for your household, so you don’t have to depend on government or independent reports for security.
God bless your Prosperous Soul,
Stephen K. De Silva
About: Stephen K. De Silva is an author, speaker, and financial mentor. From 1995 until 2017, he served as the CFO of Bethel Church, and a member of the senior leadership team. Stephen’s blend of experience, training, and gifting make him a pioneer in the subject of money. You can reach Stephen at hello@prosperoussoul.com