You may have heard the old David Allen Coe song “Take This Job and Shove It,” in which the singer tells his boss he’s not “working here no more.” In strong economies, it’s generally accepted that people are more willing to quit their jobs because they see other opportunities available to them. But when opportunities diminish, it’s more like “Keep This Job and Love It.” Quits slow down and labor turnover stagnates. Spencer Jakab explains in The Wall Street Journal:
Most U.S. economic data won’t be published until the government shutdown ends, but one snapshot of labor-market health squeezed in last week—jobs turnover. Back in the spring of 2022, when employers were dangling raises and bonuses, a record share of private sector workers quit. That’s been declining steadily and matched a multiyear low in August.
When asked how they feel about the economy, people tell sentiment survey-takers all kinds of things, if they even answer the phone. And lately, their answers reflect whether they like the president, making that information even less useful.
But being optimistic enough to give up your job means putting your money where your mouth is. When people lack the confidence to do so, and when there are fewer opportunities to jump ship, it’s an early sign of a slowing economy.
Americans’ hesitancy is backed up by private-sector data. The Conference Board said last month that its Employment Trends Index, a composite of various measures, hit its lowest level in August since early 2021. The group’s chief economist called the weakness disconcerting.
Meanwhile, private-sector measures of the number of Americans working show continued deterioration. Last week, payroll processor ADP estimated the U.S. lost 32,000 private-sector jobs in September, versus economists’ expectations of a 45,000-job gain. Long overlooked, ADP gained street cred this year after it flagged a hiring slowdown ahead of official data.
Action Line: Is American in a recession? Not yet. But it’s worth keeping your eye on the data to chart your course. Read through Your Survival Guy’s recent chart package here, and keep your eye on the employment statistics. When you want to talk about your portfolio, email me at ejsmith@yoursurvivalguy.com. And click here to subscribe to my free monthly Survive & Thrive letter.
