THE UNITED STATES LABOR RECESSION STARTED ON 9/8/23 AND IS 33 MONTHS ALONG AND COUNTING; 2 YEARS AND 9 MONTHS!! ALMOST 3 YEARS!
The US Monthly Jobs Report on Friday, 6/5/26, was 172K jobs making for happy faces. Considering that number, surely the unemployment rate slips to 4.2% or lower and the labor recovery should begin. Nope. The unemployment rate remains at 4.3%. It is odd since a couple hundred thousand jobs were reported.
The two government shutdowns messed-up the economic data that likely still needs a couple months or so to line out properly. All the job growth is in one sector; healthcare. Humorously, but also empathetically, people are probably worried about their future to the point that is it creating health problems.
Television pundits, wearing custom-tailored $4K Armani suits, proclaim that about 50K jobs are needed to replace those leaving the workforce but the number is likely larger and closer to 100K. The jobs number itself is bogus since the yearly revision in spring typically knocks off 80K jobs per month. The unemployment rate is the key metric to judge if a labor recession or labor recovery is at play.
Ahead of yesterday's job data, the chart above identified a 4.3% rate as continuing the labor recession, by a hair, while a 4.2% rate would begin a labor market recovery (verifying a stronger jobs picture that some folks are talking about). The 4.3% rate is cast in stone yesterday so the labor recession continues. For the next jobs report in early July, the same scenario is in place. A 4.3% or higher rate continues the labor recession. A 4.2% or lower rate would begin a labor market recovery.
The country has also been in a housing recession and manufacturing recession in addition to the labor recession but an overall US recession is nowhere to be seen, like Godot. The Godot Recession (the recession that never arrives) occurs because consumer spending by the wealthy Americans, that benefited from the 15 years of Fed money-printing and government stimulus, remains robust, and the AI hype and euphoria, the chip orgy, also delayed, and perhaps stopped, the overall US recession.
After the last couple years and more of economic slowness (manufacturing, housing and labor recessions), the recent manufacturing data is showing signs of life and recovery. The housing recession ended in February but Keystone has been waiting for more data (6/16/26) to confirm the US housing recovery now in progress. The housing recession started in December 2022 and ends February 2026, as long as the BLS does not throw a curve ball. The US housing recession ran for 3 years and 2 months. The housing recovery is now 4 months along and will be confirmed with data on Tuesday.
How can this be? For many decades, if America is in a labor, housing and manufacturing recessions, it is guaranteed to be in an overall US economic recession. Not now. Semiconductors are the new sheriff in town and that sector has gone great guns higher. Further, the AI hype sends stocks to the moon. The easy money provided by the Fed and Congress during the COVID-19 pandemic creates inflation and jobs galore. People could not spend the free money fast enough, like pigs feeding at the trough. Employers begged for workers during 2022-2024 but not so much anymore.
The unemployment rate popped to 4.3% in August 2024, almost two years ago, and the thinking was that it would take a big jump higher as typically occurs once a recession takes root. Alas, instead, the blue line shows the rate bumping along sideways.
The BLS data collection and releases are messed-up due to the government shutdown in the Fall and early this year. For the next US Monthly Jobs Report on 7/2/26, released on a Thursday due to the July 4th holiday weekend, as mentioned above, if the unemployment rate remains at 4.3% or higher, the labor recession continues, but, if the rate falls to 4.2% or lower, the labor recovery begins verifying a stronger jobs picture going forward. Now you know what to watch on Thursday, July 2, as the Independence Day festivities and weekend will begin.
King Donnie Chumpski chased away pretty Martina that will not sing Independence Day at the lame Whitehouse event that emphasizes Donnie's b-day instead of the country's. That's a shame. Martina McBride was electric with the Boston Pops years ago. The song is written by Gretchen Peters and is actually about child and spousal abuse. Martina had command of the performance that evening and knew she hit the ball out of the park; some nights are like that. The song became the theme song for the United States after the 9-11 terrorist attacks. The orange headed idiot says Martina is a no-talent bum. What do you think? Who would you rather be with?
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