Labor Market at Inflection Point as Big Tech Layoffs Loom while Small Businesses Try to Retain Workers
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Layoffs from big tech and other companies could impact upcoming jobs reports, though small "mom-and-pop" businesses have been reluctant to lay off staff.
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Many small businesses struggled to hire in 2021-2022 amid labor shortages, so are hesitant to cut jobs now.
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Lakshman Achuthan suggests the Fed wants to see slower job growth or even declines as a buffer against rising inflation.
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Stronger recent GDP prints may be encouraging some small firms to reduce employee hours rather than lay off staff.
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Achuthan believes the Fed erred in its inflation stance and now wants the labor market to weaken to get inflation under control.