Inflation bedeviled the U.S.economy for years, but a cooldown in price increases has shifted concern toward a different foe: Unemployment.Hiring remains solid but has slowed dramatically from a peak achieved during the nation's rebound from the pandemic.
The unemployment rate still hovers near historic lows but has climbed markedly this year.A jumbo-sized interest rate cut at the Federal Reserve last week was viewed by some economists as an effort to fend off rising joblessness, even as Fed Chair Jerome Powell offered up reassurance."The U.S.
economy is in good shape," Powell said.Mixed signals sent by the nation's labor market pose a high-stakes question for tens of millions of jobholders as well as millions of people seeking work: Where are conditions headed from here?MORE: Will the Federal Reserve cut interest rates again this year?Economists who spoke to ABC News disagreed sharply about the outlook.Some acknowledged a slowdown in recent months but dismissed worries about its implications, pointing to resilient job growth and other healthy metrics that suggest the economy continues to hum.Others, however, emphasized their concerns about the trajectory of labor conditions and what it indicates about potential layoffs."The job market is cooling but it has not frozen up," Mark Hamrick, senior economic analyst at Bankrate, told ABC News.
"This is a situation that's seen as relatively stable but results may vary."Economists widely acknowledge that the labor market has slowed.That trend doesn't come as a surprise after a years-long period of high interest rates, which typically weigh on economic activity and company hiring, some economists told ABC News.In 2022, the pandemic rebound triggered a blazing-hot job market that saw employers add an average of nearly 400,000 jobs per month.
Over a three-month period ending in August, employers added an average of about 116,000 jobs per month.The unemployment rate has climbed this year from 3.7% to 4.2%, though it remains ...