How Much Slack In The Labor Force?

Autos were weak as they fell 2.4%. They were also weak in February, so that’s a bad sign for the next report. Online sales were up 2.6% and gas sales fell 2%. Core sales were up 2.7% year over year. Headline yearly sales growth (seasonally adjusted) increased from 1.6% to 2.3%. Sales without motor vehicles and parts dealers (non-seasonally adjusted) were up 3.2% yearly; that’s up from just 0.3% growth. December had the worst reading since February 2013.


The amount of slack in the labor market varies depending on which metrics you follow. Economists have wrongly stated the labor market was at full unemployment for a few years because they didn’t think discouraged workers would come back to the labor market. They thought the unemployment rate would stay structurally high. The good news is even if the economy is at full employment, there probably won’t be a recession in the next few quarters. The retail sales report improved from January because the economy isn’t in a recession and real wage growth improved. The proxy for aggregate income growth was extremely strong in January.

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