UBS On-Air: Paul Donovan Daily Audio 'What is really happening to US labor?'

Putting aside the sensationalism that surrounds a US employment report, what is really happening to the US labor market? First, it is hard to describe nearly two years of catastrophically negative real wages as a “tight” labor market. Tightness should be judged by outcomes. Second, the defining feature of the US labor market has been churn. Only one third of California’s “temporary” unemployed workers returned to their original employer. Filling vacancies with external workers is more difficult, but hiring rates are near record levels. Third, structural changes are creating relative changes (fewer checkout operators, more delivery drivers), and mean some jobs are unreported (TikTok content creators, small business start-ups).