When Will the Waves of Layoffs Loosen this Crazy Labor Market?

Now starting to (but just a little).

By Wolf Richter for WOLF STREET.

There have been countless layoff announcements, some of them by big tech and social media companies, others from perennially money-losing companies that suddenly have to preserve cash – such as by BuzzFeed earlier this week to lay off 12% of its staff, or today by meal-delivery-penny-stock Blue Apron to lay off 10% of its corporate staff. Most of the announced layoffs were in the hundreds. Some were bigger, such as Meta with 11,000; and Twitter, a total mess of layoffs, quits, and please-come-backs. But they’re still small-ish numbers compared to the 153.5 million total employees in the US.

But there is still a historically huge number of job openings. Even as some workers in tech and social media companies are laid off, industrial companies, automakers (they’re investing heavily to build their EV divisions), and others are desperately trying to hire tech workers.

Ford, for example, is trimming its workforce in its legacy divisions, where sales are sagging, but is hiring tech and engineering talent in its EV division, where sales are booming, and where it has to start everything from scratch, including designing and building vehicles, software, supply chains, factories, etc. These companies have been starved of tech talent because they couldn’t compete with the rich pay packages and stock options offered by the likes of Twitter or Meta. But now they might be able to attract talent.

Layoff announcements by US companies are global layoffs, and some of these layoffs hit staff in other countries. For example, Twitter’s layoff numbers included its layoffs in India, where it gutted its office. Twitter also cancelled thousands of contractors, many of them in other countries.

Then there are the H-1B visa holders. Tech and social media companies, and other companies with tech divisions, are heavily staffed with people from other countries that are in the US on H-1B visas. And the layoff announcements include them. But these folks only have 60 days to find another employer after their current employment ends. If they cannot, they’re considered “out of status” and in theory would have to leave the US.

When workers on an H-1B visa get laid off, they’re not eligible for unemployment compensation in the US, and so they’re not showing up in the unemployment insurance claims that we’re going to look at.

And once they’re leaving the country, they no longer show up as “unemployed” in the monthly jobs report.

These are among the reasons why we haven’t seen a big increase in the weekly claims for unemployment insurance by the Labor Department.

But the trend has changed direction, as the “continued claims” (unemployment insurance claims by people who haven’t yet found a job at least one week after their initial claim) are now solidly increasing, though remain historically low.

Initial claims for unemployment insurance: 230,000 people filed an initial claim for unemployment insurance with their state unemployment offices in the week through Saturday, according to the Labor Department today. This was in the same low range as in prior weeks (up a little from last week, down a little from the prior week) and in the same low range as before the pandemic:

The long view of initial claims for unemployment insurance shows just how low they still are. For the labor market to soften meaningfully, we would have to see the number of initial unemployment claims rise above the 300,000 mark. When recessions occurred (purple columns), the number of initial weekly claims was spiking through the 350,000 range.

This shows that most of the people who got laid off found a job so quickly or already had a new job waiting in the wings that they didn’t need to file for unemployment compensation.

But some people now have a harder time finding a new job. The number of people who are still claiming unemployment insurance at least one week after the initial claim – people who haven’t yet found another job – rose to 1.67 million, according to the Labor Department today.

This is still historically low, about as low as during the lowest points just before the pandemic, and way lower than anything since the mid-1970s  (when there were many fewer working people).

But it does show that the trend has solidly reversed, that some people are having a harder time finding a new job, and that they stay on unemployment insurance a little longer. This is a sign that the labor market is getting a little less tight:

This is the short view:

The long view shows just how historically low the 1.67 million continued claims are. But it also shows that the trend is now rising, having solidly reversed course. During the mild recession in 2001, these continued claims rose as high as 3.7 million. During the Great Recession, they jumped to 6.6 million.

We’ve had other indications that the labor market is getting just a little less tight, but remains very tight. The weekly unemployment insurance claims are the timeliest data we have. And they depict a labor market that is still amazingly tight, given all the layoff announcements, but is starting to loosen up a little to where some of the people who lost their jobs – and they might not be tech workers – are having to look a little longer to find a new job and remain on unemployment insurance just a little longer.

To stick with the “soft landing” analogy, the labor market is not landing at all yet, but it’s losing a little altitude.

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  239 comments for “When Will the Waves of Layoffs Loosen this Crazy Labor Market?

  1. ZelenskyIsAPunk says:

    Could tech layoffs be somewhat “hidden” in the labor data? A lot of those affected got generous severance packages. Those who are riding out severance may choose to delay filing for UE. Some states such as GA don’t allow any unemployment benefits until severance runs out.

    Maybe we see a big burst in claims after the New Year, when folks realize that they’re not going to find a new tech job quickly, and their severance is running out in a few weeks?

    • Wolf Richter says:

      The layoffs started earlier this year. I’ve been covering them. This is an ongoing saga. This isn’t just some new thing that came along in November.

      • JayW says:

        A mini wave will start to build by the end of March ’23, or about 1 year after the FFR increases which have a lagging effect on corporate earnings.

        First Time UE Claims end of month:
        3/2023 – 265K
        6/2023 – 285K
        9/2023 – 310K (soft landing)

        After this, I’d say it’s hard to tell if they move towards 400K by 3/2024 or what’s called a hard landing.

        And as I’ve been saying for more than a year now, what matters most is if rent & mortgage relief are trotted out again to thwart a significant economic downturn. Will the Fed let housing go into a REAL tailspin that puts a 30% or so downturn into play? I don’t see the 30YFRM moving above 7% again as the FFR moves up to 5%. Rather, the yield curve will diverge further. The10YT will rise some but begin a steady decline by spring next year.

        I don’t see the Fed’s QT running past later summer 2023.

        • Einhal says:

          I think the difference is that Fed will not go along this time, so any spending by Congress will have to be paid for with tbills issued at market rates.

          Also, without the Dems having control of the House, I don’t see their being able to pass a “No one has to pay rent or mortgage” easily. Sure, JB will try with various executive orders, but those will be short lived, as the House will have standing to challenge.

          All mortgage “relief” does is transfer money from those who were responsible to those who were not. The GOP is tired of that

        • NBay says:

          So…Einhal…..are you one of the “responsible people”?

          There are two ways you can take that.

        • ThomasJ7777 says:

          I don’t think there is going to be a recession. There seems to be a fundamental mismatch between what rich oligarchs would like to see, and what reality is going to deal them.

          The first dose of reality is demographic: There are historically high numbers of people who are retiring on a daily basis. The people who are retiring are leaving jobs. People who have been waiting for the high paying jobs for decades are leaving their middle tier jobs, and younger, new talent is also stepping up to take those jobs.

          Both of those realities are leaving gaps in middle tier and start-up living wage slots, and younger people are stepping into them. That leaves an 11 million job hole at the bottom, and those jobs are trending up in pay to attract workers.

          There isn’t going to be a recession as long as that reality endures, and it will endure for at least eight more years.

          There is a fix for it: Fixing the immigration system to create more legal immigration. It will be necessary to do this anyway, because infrastructure projects need to be built.

          The second reality is the relationship between QT and infrastructure/energy spending by the government. As the Fed unwinds trillions in free money to corporations, the government is going to pick some winners in the market.

          The financial and tech industries are going to be hit with layoffs, but this is due to QT.

          Infrastructure spending will absorb those layoffs. The job market is going to roil with highly paid professionals taking pay cuts while the working class posts gains.

          The third reality is demand for goods and services. What the Fed and the government are doing right now is creating a solid floor for retirees. This explains the bond market in several ways. The retirees will continue to keep a solid floor for demand, while the younger workers will continue to spend more of their rising incomes.

          The inflation problem is being created by profit-taking by large corporations. They are taking 50% profits. Because of this, the problem cannot be solved by raising interest rates. As long as demand is undaunted by these huge profits, no meaningful action will be taken to curtail it.

          However, the government may take steps to broaden access to capital. If that happens, there could be price competition that drives down prices and tames inflation. I see this as a more likely scenario than a recession.

          But of course, rich oligarchs don’t want to see that. And they don’t want others to see it. They want everyone to be talking about “the coming recession.”

          The Fed and the government are already taking steps to unwind wealth inequality and free up capital. If the Fed doesn’t buy corporate and government bonds, then the supply of corporate and government bonds go up, and the price goes down. This is the basis for the floor for the funds that retirees depend upon.

          Also, the banks have more cash to lend, and new borrowers. The full employment floods the government with money, and reduces the dependence on selling bonds.

          All of it points to a larger capitalist market, with more players, and more transactions.

          The US economy is not at the end of a cycle! The Republicans and their oligarch sponsors want to believe that, and they also believe that they can make the reality that they desire, but tell me how they change the demographics, and the policies addressing that reality?

          They can’t. They shouldn’t try. But if they want to lose their money and throw temper tantrums, then that will be amusing, but it won’t stop the tide of history.

    • Swamp Creature says:

      We’re in a rolling recession which affects some industries more than others. Right now, the RE industry is in a recession here in the Swamp. It could be heading for a depression. No one can afford the average home at these ridiculously inflated prices with the accompanying high interest rates. Only the rich are unscathed. Those who have to move will have to sell at a loss. Most people are hanging on by their fingernails. The Fed will keep increasing interest rates until inflation is under control which will make the situation even worse. All the business here that feed off of home ownership, and home buying, building, selling, are going to be laying off people left & right. It’s happening as we speak.

      • Dweedle Dee says:

        I live outside of the Swamp also, in the northwestern corner of Virginia, and sellers are still smoking the Hopium of yesterday’s listing prices, with overall asking prices maybe down as little as 2% from original Listing. I also agree that this downturn in real estate will be one for the records based on the humongous price increases prior to the current air pocket, the suppressed level of mortgage rates (thank you, Fed), the mountain of Debt at all levels, and the budding recession unfolding that will be anything but a soft-landing. Powell don’t believe it will be so (soft, that is), and he holds the Tightening Lever.

        Inflation is still stubbornly high and supply-constraints as we enter Winter in the U.S. almost guarantee that it will stay high, if not get worse (like in grain-related foods and energy in all formats). Still thinking a Fed Funds by 3rd Quarter, 2023 from 6.5% to 7%, and upping the Acceptable Rate from the ethereal 2% won’t happen until 2024 to 2025. Thinking 4% will provide some cover for the Fed.

    • Horton says:

      I work in big tech, I just got another offer at a smaller firm for more money. I am still getting blasted with Linkedin Messages…It is strange but there are still a ton of jobs, just at small not well known places and other stuff like insurance etc

      • russell1200 says:

        Non-residential construction is doing well and should do so for some time.

        It always seems strange, but employment is a lagging indicator. The strange bubble land we have been living in for some time has distorted the standard business cycle, but it is still there.

        This downturn is starting with the classic drop in housing starts, and there is no mortgage bubble to hide it. It seems pretty normal to call the downturn and backdate it one-year after the downturn actually starts. So I am guessing employment catches up in a year and we backdate the start of the downturn to sometime about now.

  2. MF says:

    It’s annoying to see this narrow focus on unemployment. The labor participation rate is still low, but nobody talks about the need for reducing the gulf between executive pay and hourly workers’ pay. I bet there’s no shortage of applicants for $250k+/year jobs.

    • Kentucky says:

      The so-called “Living Wage” keeps one foot out of poverty from paycheck to paycheck. We, as Americans, want things fast and cheap but ultimately there is always a price to pay.

      I bought some take-out Chinese food the other day and there was a 15% additional charge (pre tip) for employee wellness. On one hand I was slightly irritated because I’m not use to the surcharge but then I chewed on my thoughts and said to myself, “these restaurant people aren’t rolling in it, is it really going to kill you to give them a little extra?” The answer is of course not.

      People that work hard and do the right thing when no one is looking deserve prosperity wages – not just living wages. And, as Americans, we must adjust what we are willing to pay for the conveniences of not doing things ourselves.

      • Einhal says:

        Could not disagree more. If a restaurant wants to do that, go ahead and raise prices by 15%. Do not add it on as a dishonest “fee.” All that’s doing is allowing them to advertise prices that are artificially low.

        • Eric says:

          I agree with both of you.

          Companies should raise prices, pay their employees more, and pay their executives less.

          And customers should know the price, before making the purchase.

        • Anthony A. says:

          And who knows where that “employee wellness” money ended up? I’d prefer the raising of prices the 15%.

        • Harrold says:

          Fees are not taxed.

        • rojogrande says:

          Eric, it sounds like you agree with all three. I agree that raising prices is the least deceptive way to charge more.

          Harrold, in California at least, any mandatory charge on a restaurant bill is subject to sales tax, including mandatory service fees and “tips.” Some restaurants get around this by allowing the customer to opt out of a tip that is automatically placed on a bill.

        • dr_doomz says:

          “Companies should raise prices, pay their employees more, and pay their executives less.”

          And don’t forget, then go out of business because they’re no longer competitive. Or are you suggesting they collude? And if they do collude, what happens when customers stop patronizing them because the prices are too high? Do we create a law that forces everyone to buy from them (so they can pay living wages to their employees)? What about those who can’t afford the now more expensive products or services? Will they be impoverished? If they are, what is your solution, apply for work at the colluding businesses that impoverished them to begin with? Notice your logic doesn’t stack up?

        • Eric says:

          You present as a very clever sophist, Dr Doomz. Kidding!

          You are right about one thing. The entire economy, cannot be summed up in a single sentence.

        • Apple says:

          If companies refuse to pay their employees more than they should stop complaining they can’t find workers.

        • Alex says:

          I work in the health sector, we are desperate for employees as population over 65 explodes.

        • bulfinch says:

          You’re right; and Americans will need to adjust to the idea of dining out becoming more of a rare luxury, rather than a staple doing 3-5 Xs a week. Same with drinking out.

          There was an article in the NYT a year or so ago to this same affect. Prices will need to go a lot higher in order to provide the type of compensation which will attract & retain workers doing this very hard and highly-prized labor — a really good server/barkeep is enough to keep me from moving too many zip-codes afield, whereas high turnover at a place is a turnoff (makes me wonder what kind of coke’d out tyrant is running off the staff behind the scenes).

          Also as a rule, I won’t dine anyplace where the lowest paid staff member cannot afford to dine there.

        • Mr. House says:

          “You are right about one thing. The entire economy, cannot be summed up in a single sentence.”

          Not true, it can be summed up in one word: Fraud

        • NBay says:

          I always felt HYPOCRISY was a much better fit. ESPECIALLY in a so-called “Good Christian Nation”.

        • NBay says:

          However, I am also aware that our Calvinistic interpretation of Christianity’s basic “Golden Rule” (found in all religions, incidentally) provides a loophole in it big enough to sail a 400 ft yacht thru.

        • LK says:

          I refuse to continually patronize a business that isn’t up front about the cost of something in order to appear more attractive that they are, then, once I’m committed, raising the price.

          Fool me once.

          Yes, I understand that’s the essence of sales, and that certain one-time situations, like a car purchase, will bite me in the ass. Food service is more where I’m thinking.

      • Cytotoxic says:

        “We” don’t need to do any such thing. I am not interested in carrying the burden for someone else’s prosperity, nor am I interested in solving the non-problem of hourly vs executive pay.

        Feel free to join me and those like me in lowering the cost of living by allowing more housing and ending the Jones Act and other onorus regulations.

        • Bs ini says:

          Yes agree with regulations and zoning big need for additional housing in areas that have job growth and water and energy resources difficult combination to find

      • josap says:

        The restaurant is virtue signaling with your money. If you want to feel good, leave a larger tip.

        And what does “wellness” mean? Good quality health insurance, paid sick days? What are you paying for, a new benefit for the employees or covering a required (by the employer) benefit they already have?

    • Augustus Frost says:

      The most direct way to end the gulf between executive pay and line employees is to end artificially cheap borrowing and the (sub)basement lending standards that go with it.

      Ridiculous compensation is another side consequence of the asset and credit mania. It’s not entirely caused by the mania (preceded it starting in the 80’s) but most of it would (and will) go away once the mania ends.

      At minimum, the end of the mania will reduce outrageous equity compensation which is most of it. I can’t say that it will end it completely, but a protracted bear market will make shareholders and presumably eventually, company boards, make changes.

      Institutional shareholders in particular have been derelict in this area. They need to vote against excessive compensation, including ridiculous “golden parachutes” for failure.

      • rojogrande says:

        I think that’s a good assessment of the situation.

      • bulfinch says:

        A better competitive edge might be in offering a product or service which is peerless in your industry, rather than screwing your employees over in order to offer the SOS at a nickel less than another purveyors.

      • Iona says:

        End stock buybacks and only allow earnings using gaap to be reported. Last few earnings reports I read were just pure fiction.

      • Felix_47 says:

        Ridiculous compensation is a choice……of the voters and their representatives. The US deserves a fair tax policy that funds the government to a level that the citizens want and want to pay for. We tax cigarettes and liquor. Why can we not tax irrational compensation packages? Because our oligarchs have paid off the oligarchs in Congress. So it all goes back to campaign finance reform. SBF, although cartoonish, seemed to understand that well and his only problem was to think that the free money from the government would continue for another few years. His donation list is a “how to do it”for any aspiring entrepreneur.

    • WolfGoat says:

      Ahhhh…. there’s that ‘Participation Rate’ thingy again!

    • vinyl1 says:

      Believe it or not, the $250K+ jobs are among the most difficult to fill. Only a tiny number of people have the skills to do these jobs, and they all have jobs already.

  3. Flea says:

    CEO pay is rediculios plus benefits and golden parachutes,coaching pay is disgusting,and these idiots wonder why no one will work

    • RH says:

      Executives are often paid to distribute wealth to cronies and to allow in or to disregard law violations or criminal activity or even to participate in it. I speak from personal experience, since they do not take your refusal to cooperate, e.g., by refusing to sign perjured declarations, with criminal conduct with equanimity.

      I predict a lot of overleveraged, corrupt companies will soon share the fate of Enron, because inflation will be reduced by a coming financial disaster but other, economic conditions will drive them under: e.g., reduced demand as a certain country’s emperor has now had his servants suddenly claim its major problem is “not so scary.” Due to its lack of preparation and the foolish decisions of that person, that empire will soon face the same fate as the mosquito on my windshield, as that problem eats that empire.

      The first bites already started shortly after that empire decided to effectively ignore its problem. Vicious, economic circles are starting to spin up further.

  4. Erik says:

    Labor market is one of the biggest if not the biggest bubbles remaining. H1B stuff you mentioned will amplify it eventually

    • Old school says:

      When the excessive money drop gets out of the system then spending will slow and companies will have to reduce staff to rationalize the business. Give it a few more months.

      • perpetual perp says:

        Four decades of tax cuts for the already very well off inflated asset prices. There’s your inflation. Taxes need to be raised on the limo crowd.

        • Ervin says:

          I bet you have no idea the distribution of income taxes paid by the income percentages in the US. The bottom 50% pay practically no income taxes and the top10% pay 70% to 80% of the collected tax money. Please explain how much this should change and why.

        • Wolf Richter says:

          if you add Social Security taxes and Medicare taxes to the equation, it changes dramatically. Try it.

        • NBay says:

          Well Ervin? Your silence is deafening.
          Did your thinking fall off some kind of logical cliff? Or was that question actually all you are mentally capable of on the subject?

          At least have the courtesy to thank Wolf for a response to your question.

        • Einhal says:

          Yes, they pay FICA (Social Security and Medicare), but then those same people say that those aren’t really taxes, but “payments into a system” such that when they retire, they’ll have “earned” those benefits. NBay, you can’t have it both ways. Either they’re taxes or they’re not. If they’re taxes, then you can’t say they’re prepayments for Social Security and Medicare.

        • Wolf Richter says:

          Now wait a minute… It’s people like you, Einhal, who say they’re just taxes, rather than pension fund contributions, but when it comes to counting taxes, they are suddenly not taxes, LOL

        • rojogrande says:


          The bottom 50% earned 11.5% of adjusted gross income in 2019. While they paid only 3.1% of all federal income taxes, please explain why you think they can pay more? If you don’t think they can pay more, why are you using them to justify the income taxes paid by the top 10%? Relatively speaking, the bottom 50% don’t earn anything, that’s why they pay very little.

          Please note that this is a separate issue from how much the top 1% or 10% should pay. I’m pointing out that when half the population earns a little over 10% of all income, it’s not reasonable to expect them to pay much in income taxes. They should not be a measure of how much the top half of earners pay. Really the issue is at the top 1%, not even the top 10%. The top one percent’s adjusted gross income at 20.1% of total income is almost double the entire bottom 50%. I’m purposely not addressing the top 10% specifically, because the next 9%, while earning a lot, it is only 27.6% of total adjusted gross income. Not much more than the top 1%.


          Since you can’t have it both ways, is FICA a tax? I think they are taxes to support specific social programs and I’m OK with that.

        • Einhal says:

          Wolf, hahah, yes, people are inconsistent on this. I personally think they’re taxes that are just allocated and accounted for differently. That’s why I don’t buy the argument that anyone is legally “entitled” to Social Security and Medicare, and the courts have generally agreed.

          Ervin, I agree that our income disparity is a problem, but allowing people who pay very little in taxes to vote for higher taxes on people other than themselves is the type of thing that destroys societies.

          Our bottom lives very well, relatively speaking.

        • Shiloh1 says:

          The devil is in the loop-holes, write-offs and subsidies; the actual rates are obvious.

          Kindly Old Uncle Buffy paying less income tax than his secretary, in his own words.

        • Einhal says:

          The “Warren Buffett pays a smaller percentage in taxes than his secretary” is a stupid, dishonest meme. The ultra rich realize most of their income through investments and capital gains. Their income isn’t realized unless they want it to be realized.

          But the people pushing this idiotic meme are the same people pushing to raise taxes on the “working rich” who realize most of their income from actual work. So they propose to tax the upper income professional couple at 60%+, while leaving Warren Buffett’s taxes untouched.

          It’s intellectual dishonesty at the highest level.

        • LK says:

          Oof, Wolf, what an incisive and precise retort to that talking point. I am Orson Welles slowclapping.

        • NBay says:

          Where did the damned net wealth charts go? Words can be spun too easily. Wolf left me wide open to a notorious word spinning right wing planet be damned troll.

          I didn’t want ANYTHING “both ways”, Einhal.

          Sorry if I see overconsumption and class warfare as major problems, but I do.

        • Wolf Richter says:


          “Where did the damned net wealth charts go?”

          hahahaha, yes you caught me red-handed moderating myself and deleting my own friggn comment. Like I said, happens to the best of us, don’t take it personally…

          There’s nothing wrong with the chart, but my comment (the words) needed to ride into the sunset.

          That one?

        • NBay says:

          Yes, Thanks.

          Those “sunset-needing” words were merely a question to be mulled over after studying that socially obscene chart, so I still don’t get dropping them…..oh well, there is much I don’t get, like the next article, which me a headache. But I’ll try again.

          I think everyone knows we are LONG past the point where adding more and higher progressive income tax brackets alone will change the obscene picture the chart shows.

          It’s obviously estate taxing time….like the Biblical Jubilee Year, which served the same function.

          But if not changed, it is the lower level wealthy like Einhal who will reap the “nothing left to lose” whirlwind first, so I don’t blame him for being as scared as he is for his own “hard earned pile”.

          But, it’s better to bend than to break.

          His enemies are above him, not below him. I know, I grew up with them, and am related to their offspring…by blood only, in most cases.

        • Prairie Rider says:

          An interesting tax law exists, or it did before 2011, relating to FICA.

          Lets say you run a wheat seed genetics business. The company develops new varieties of wheat as their job, and makes an initial production run of “Foundation seed” when they have a new variety to bring to market. This seed is given to your distribution network, seed dealers, to be grown in the next year; inspected by state crop improvement departments, certified by the inspectors, and it is then sold to farmers the following year.

          The seed dealers remit royalty payments to the company from the sales they make. But the income generated from these royalties is not subject to FICA. Though not subject to FICA, the revenue is, of course, subject to income tax

          Those are (were) the rules of the U.S.A.’s tax code.

      • Wolfbay says:

        You may be right but I’m wondering if there is a recession it may be mild. Didn’t Biden give 52 billion to the chip companies? 880 billion to defense with billions more for weapons to Ukraine. Thirty six billion to the central states pension fund. Yes the rank and file should get there pensions but neither union officials or Wall Street were held accountable for this fraud. They can collect the “vig” again now. The green new deal was 660 billion .Isn’t every dollar government spends added to gdp? The junta of big government and big corporations are spending plenty.

        • Evelyn Wood Head says:

          Regarding the CS Pension fund. $36,000,000,000/350,000 retirees =$102,857 per retiree. That would be a large amount if the pensioner only lived 1 year.

        • Ed7 says:

          The U.S. bottom lives relatively well compared to Africa or much of SE Asia, sure.

          That’s however sort of an odd metric for a leading nation such as the U.S. to use.

          The more common standard used, in my experience, at least before globalization sent jobs whizzing overseas, was how much the U.S. factory worker made compared to the CEO of the company or the factory boss. By the standard, the executive suite and the top 0.1% generally are really raking it in.

          The ratio of income between the peons and the lords within the U.S. in comparable to the peaks of the 1920’s.

          The results are visible in our politics, even if the far right and far left have very different diagnoses of the reasons.

  5. W says:

    Per the above, participation rate is low. Restart or re-scaling a business requires more labour than running an existing one. The economy tilted to at home and is now tilting to in person requiring a reallocation of labour. Coming out of Covid, there was going to be a spike in labour for the above reasons. The labour market is merely responding to the friction of restarting an economy.
    Interest rates should be set at what they were at pre-covid. Increasing them will not prevent the friction. There will be inflation as the central banks printed 10 to 15 years of money supply in 18 months so we are going to get 10 to 15 years of inflation in 2 to 3 years. Nothing will push prices down except a depression. BTW, printing all that money to avoid a collapse of the world economy was a smart move at the time. If inflation goes up, wages will go up, always has, always will. Raising interest rates now makes it harder for the average person to weather this friction and unavoidable inflation storm.

    • Ted Byrley says:

      Interesting. Do you have any evidence of this rescaling issue and the persistence around it?

    • Nissanfan says:

      You sound like one of the “Fed needs to pivot” individuals. Lowering rates will only psychologically enable people to feel “rich” again, just like in 2021. Same people need to be conditioned to spend less and slower. Lowering rates, will not do that.

      Furthermore, companies got simply lazy in terms of inflation. Cost reduction became a side project. Why? Because it is easier to pass on the increase onto the end user and as long as the end user is willing to pay the price, this bad behavior will also be embraced.

      From my POV: Just by watching the housing market (chicagoland area), when mortgage rates went down from ~7% to ~6.XX%, many properties i have been watching for weeks, all of the sudden turned all contingent. The minute there will be any form of pivot, attitude of consumers will be: “we have to buy it now, or we will miss out our chance again” – and vicious cycle would start all over.

      There is no easy way out of this one. That’s as “soft” landing as it will get.

      • IN says:

        >>Same people need to be conditioned to spend less and slower

        Back when scary COVID was only starting to attack the world, some people on Instagram/ FB and other social media complained in tears about how terrible their life would be if travel restrictions are imposed with only “necessary” travel allowed with “necessary” being “work-grocery store-doctors office-school”, rinse and repeat. It sucked to realize I may have already been living under some kind of restrictions, because 99% of my travel has always been falling into one of those categories.

        Kind of the same thing here. I drive a 15yo car, use a 2015 desktop computer, buy a lot of used stuff, use a prepaid phone, don’t use any expensive subscription services and get groceries mostly at discount stores like Aldi or Lidl, despite technically having a decent salary even by local overinflated standards. I am not sure I can “condition myself to spend less” without seriously compromising on some basic quality of life things. The only realistic option for me in such an inflationary environment is to boost my income by either job hopping for a higher salary or by finding side gigs. Both in the end would probably contribute to inflation even more. So what should I do then? An honest question here.

        • josap says:

          Honest answer: you look like you are already doing all you can. The only thing you did not mention was moving to a lower cost apartment/house.

          Good luck.

        • IN says:

          josap, thanks. I am pretty happy with my living arrangement as I jumped into the departing train of both low rate mortgages AND almost-realistically priced houses in my area, so my current mortgage payment now is on par with what others pay to rent much smaller places.

          I think I may have not delivered the message I had in mind properly – I am not complaining about my lifestyle, really – I have always been pretty modest and frugal and I sincerely think that almost nothing beats nice home-prepared healthy food, both from the price standpoint and from the nutrition/healthiness one.

          What I had in mind was that at the individual household level the only real way of feeling less pain from looking at grocery receipts is striving for higher income. I work in tech and I think if I try hard enough, I may be able to hop to another job asking for more than I make now. However, it feels like *from the local economy standpoint* individual actions like this would simply put more fuel into this inflationary fire! That doesn’t intuitively feel right and I am really not sure how to approach my personal financial situation in a medium term (next 5 years).

        • Natron says:

          It’s not so much how much you make but how much you keep. Sounds to me like you’re doing it right. Why blow cash on glitter when it provides no lasting value? I drive an old car because I’d rather support my local mechanics than pay the Chinese to build me a new one. Keeps the money local.

          The lifestyles of the rich n famous programming works on many of the envious types but if you chase the Joneses then you’d have to hang out with these people.

    • rojogrande says:

      I don’t think the inflationary storm was unavoidable because the monetary and fiscal response to Covid was way overdone. However, even if high inflation was unavoidable, there are lots of average people, including many retirees, for whom increased interest rates will help them weather this inflationary storm. I disagree that tolerating high inflation, and thereby pushing the cost of the response to covid onto savers and people with fixed incomes, is appropriate. If high inflation is an unavoidable consequence of the response to Covid, then higher interest rates should be unavoidable too.

    • Einhal says:

      Nonsense. Printing $3 trillion in two months was not a smart move at the time. It should have been a measured approach, based on what was needed.

      Now we are dealing with the consequences.

    • Depth Charge says:

      “BTW, printing all that money to avoid a collapse of the world economy was a smart move at the time.”

      No, it was stupid beyond words. What the FED did was the equivalent of bringing a nuclear bomb to a fistfight. It was the most reckless overreaction imaginable. The math made no sense at all, and still doesn’t.

      • Evelyn Wood Head says:

        Within the first year of Covid the United States was one quarter away from a horrible depression… Life would have been really miserable for us all because we would have ALL been broke AND dying of Covid…”Kicking the can down the road” as the powers planned, leaves us all in a much better situation then it would have been if everything was left to naturally work itself out.

        • Einhal says:

          What was your basis for this? The federal government handed out so much money that a depression was mathematically impossible. Yes, without the fiscal and monetary “stimulus,” there would have been a recession, as economic activity relating to restaurants, hospitality, travel and so forth ground to a halt. But it was more than made up for by trillions in spending on manufactured crap.

      • NBay says:

        Agree. “bringing a nuclear bomb to a fist fight” is one of the STUPIDEST things I’ve ever read.

  6. Arya Stark says:

    I can tell you certain areas are slowing down dramatically in tech while others are still red hot. There’s still plenty of work there I just think companies over hired and now need to trim the fat. I don’t see mass layoffs coming anytime soon.

    A yoga pants company still has $8 billion in revenue and Elon Musk thinks the Fed has been crazy to raise rates so high. We do live in a state of cognitive dissonance.

    • Depth Charge says:

      Muskeg is talking his bottom line. He’s getting torn a new a***hole, financially speaking. Like all billionaires, he’s watching his wealth evaporate on the daily. He, Ray Dalio and Co. are trying to force the FED to bring back their corporate socialism through selfishly transparent scare tactics.

      • phleep says:

        Couldn’t agree more. These fake visionaries are always sounding the alarm of “crisis” from some grand strategic perspective that reflects their vanity. They think a few very good, big hits translate into every domain of supposed wisdom and vision. And the fanboys eat it up.

        • Nissanfan says:

          All those fake visionaries apparently didnt look into having cash reserves for unexpected circumstances, such as Covid shutdowns, economy slowdown etc

          I remember Richard Branson from his private island crying for bailout in 2020. Then in 2021 flies to outer space.

          Since money printing tide slowly goes out, it also begins to unravel, which companies and visionaries are “swimming naked” out there.

        • polecat says:

          Well, once that neural net thingy goes live, we’ll perceive all is hunkydory! …. courtesy of mr. ‘Feelgood’ E.M.

          We’ll ALL be employed – in making the grand b i l l i o n aire ever moarr avaricious, no?

        • NBay says:

          Well, this “neural net” doesn’t have any electronic glial cell units, especially astrocytes, so at least it won’t get MS, Alzheimers, or many other neurological diseases.

          I suppose that will make it “think” better?

      • Mark says:

        Depth –

        Plus 1000 % on your comment. Fed exists solely to service the unelected banking cartel, plus the ultra rich.

    • josap says:

      The VA needs thousands of tech people. Probably at less pay, but it’s a job.

  7. Ted says:

    I guess we should expect a crazy labor market after the recent crazy economy of the party few years. I think it all comes down to the lower participation rate, with extra millions dropping out of the labor market. Businesses will continue to struggle with this for years. Good for people, who will finally get compensated enough and not be abused by employers. Not so good for business. Too bad, so sad.

  8. random guy 62 says:

    Business (truck equipment manufacturing) has been a wild ride since mid-2020, and we just hit our breaking point from bouncing back and forth from profit to loss month to month. We’re already running lean in the shop. It’s time to completely reset prices with a bias toward the high side, and swing a hatchet at SG&A until the bottom line shows black every month.

    We’ve been on the fence about eliminating two salary positions for about a year – one sales, one scheduling. They are great guys but just aren’t generating enough value to offset their paychecks. Both are getting pink slips after the holidays. Those two cuts alone are about 1/4 of cost cut required to get us back on target.

    My gut sense is that we will end up cutting deeper, but that all depends how the top line holds as these interest rate hikes start to choke off profligate spending in the economy.

    • Cytotoxic says:

      What about smaller paychecks?

      • random guy 62 says:

        Meh. Always a consideration, but not in this situation. Employees not pulling their weight ultimately just drag down the income potential of their peers. Allow too much of that, and you get a failing business.

        Job cuts are painful but necessary. Like forest fires and recessions, they need to happen from time to time.

  9. John Apostolatos says:

    Why this time will be different in tech…

    Most companies produce nothing of value any more, and we can live without them when they go under.

    Do we really need Facebook, and see what selfies some narcissist is posting? Do you really want to live in Metaverse with your avatar?

    Who cares if FTX went down and their tokens disappeared?

    My point is that so many of these so called post-pandemic workers did not learn to work in professions that actually produced something of value, and as such did not acquire the skills to produce anything of value. It was all hype fed by easy money, and they will have a hard time getting high paying jobs again which will push up unemployment in 2023 and beyond.

    • Halibut says:

      Tech goes far beyond your examples. All other businesses and government agencies (at all levels) need coders. Everything from plant automation to school lunches need coders. Systems degrade over time and need to be replaced. All the data from old systems must be migrated. And on and on. Tech workers provide plenty of value and they ain’t gonna just disappear.

      • John Apostolatos says:

        “Tech goes far beyond your examples.”

        As Wolf hints at times, please read the entire response before making assumptions. I did not state that tech workers do not “provide plenty of value” as you imply. I stand by the claim that many of the recent tech jobs were not valuable to the society, especially social media companies that are using people as products to trick them to click on ads. Cryptos started well but became a classic Ponzi scheme. As such these jobs will disappear unlike in 2000, and good riddance.

        • Venkarel says:

          John you are not the only one, I have heard many I intelligent people bemoan the fact that over the last ten years our brightest minds have spent all there time and energy figuring out how to sell others peoples stuff.

        • Augustus Frost says:

          It’s not just social media and crypto.

          Just because something is necessary doesn’t mean it’s economical or affordable.

          To the extent these tech workers have jobs in the future, it’s going to be at lower purchasing power pay, once the asset and credit mania is confirmed as being over taking this fake economy down with it.

          No different for most everyone else.

          The majority of Americans are destined to become poorer or a lot poorer.

        • Will V says:

          Personally aware of 3 physicians including a neurosurgeon who left clinical practice enticed by VC monies into a tech startup companies that provided little value to the system. Even the one that moved to “medtech” was more about maximizing “profit”. All lived in California where housing and taxes chewed up that big 250k doctor paycheck.

          The offers they got were 3-5x that, hence the jump. It’s a sad observation, but I get it. Who’d wanna work night, weekends, high stress when you could chill in glass buildings with your MacBook sipping single origin coffee with “tech boyz” at 3-5x the pay dreaming about how to create a “revolutionary” service. All of this occurred due to cheap monies and why NO ONE is working in healthcare.

        • Einhal says:

          Agree with all of you. The last 13 years of ZIRP and QE has distorted everything such that no one even knows what “value” is anymore. We’ve incentivized our best and brightest to do crap (although to be fair, that began long before, probably in the 80s and 90s). The people who used to become doctors, engineers and visionaries instead offer “financial products.”

          I remember reading an article in the Times about two siblings who both graduated summa cum laude from Harvard Law School. It’s so rare that a decade can go by without such an award. These two siblings both went to work for Wachtell Lipton (a boutique law firm that represents the targets in hostile takeovers). I remember seeing a comment that these two brilliant minds chose to use it to advise Wall Street on M&A, instead of doing anything useful.

          That’s become our economy in a nutshell.

        • Crunchy says:

          Interesting and relevant story, but unfortunately the lawyering industry as a whole is (and has been for longer than most) a bottom-feeding parasitical burden on business and society.

        • Einhal says:

          Right, but that’s the point. Our incentives are such that our brilliant minds choose to do things like corporate lawyering, trading, hedge funds, and other parasitic industries.

        • Mark K. says:

          As someone in medicine, I will tell you that there are lots of bright minds still entering medicine. However, admission to medical school is extremely competitive and graduates leave with somewhere between $300-500k of student loan debt. They then complete grueling residencies (where they often have to move across the country), working 3-7 years, 80 hours a week, and making minimum wage.

          After residency, the majority are exhausted from a broken healthcare system, up to their ears in student debt, and generally have to become employees in large healthcare systems where administrators tell them how to practice, to see more patients, and to meet “relative value unit” goals, which are essentially like sale quotas. Not to mention, the medical profession is being degraded by governments allowing nurse practitioners to practice independently when many have simply obtained an online degree without any vigorous training.

          Therefore, it is no wonder that the best & brightest run to the pharmaceutical, finance, tech industries as soon as they have the opportunity. Unfortunately, the system is broken and I don’t think QT and the end of easy money is going to change it.

        • NBay says:

          Good luck Mark.

          There are new diseases and new “magic bullets”, ie, medicines, (Rx, OTC, and sold on mass media only. And also many procedures sold from the same sources) invented (I mean “discovered”) almost daily. So you have MUCH to learn.

          Incidentally, I find it TOTALLY amazing that it took 4 billion years of trial and error for presently extant humans to evolve, yet improving upon their “health” is proceeding at such amazing SPEED and in so many different ways in just the last 90 years, or so. (Around when old man Sackler began direct marketing to doctors, and then others took it to mass media.)

          We must truly be made in God’s image to have such incredible abilities.

          I also wonder if God is a capitalist…..I’m fairly certain he is, but alas, he has never spoken to me, unlike many others presently alive or throughout history…..just not “a chosen one ” I guess…….He must not like me.

      • anon says:

        Halibut writes that “… tech goes far beyond …”

        As a retired last 60’s boomer computer geek I agree 100%.

        I don’t have accounts on Twitter, FaceBook, Tik-Tok, SnapChat or ANY ‘social media’ … (is Wolfstreet social media?).

        I am, kind of, following the ‘tech’ side of the Twitter saga these days.

        IMHO the largest majority of the ‘tech’ layoffs from it had zero to do with ‘coding’.

        Not sure about who got cannned from FaceBook or BuzzFeed. Did they do ‘tech’ or were they writers/content police?

    • Depth Charge says:

      I personally believe the internet is aging much like the old cable/satellite TV networks and companies. The “experience” is degrading, and more and more sites have paywalls. How many subscriptions can the average person really afford per year? Not many, is my answer.

      I think the future will prove to be less “virtual” than clowns like Zuck believe, as people “cut the cord,” so to speak. I plan on it. Aside from Wolf’s site, I don’t honestly know if there’s anything else I’d miss. My online shopping has really diminished. I prefer brick and mortar.

      • Random guy 62 says:

        Completely agree. The relentless pursuit of profit can do some great things, but it tends to suck the soul out of life. It has sucked the soul out of the internet.

      • joe2 says:

        I agree that the internet is going to get more Wild West and require some serious sifting through the dross. Both to find uncensored information and to skip over the patently ridiculous. But unless you don’t care about the world and how it affects you, you still need a source of information. And the MSM is laughable. Wolf is fine, but he has limited scope. Even YouTube is degraded now with a lot of censorship and ad blizzards. No one said it was going to be easy with the increased herding and fleecing of online commoditized consumers.

        You must have better brick and mortar stores near you. Around me all I see are women’s clothes and shoes and snack foods. To get what I need I have to go on-line.

        • Motorcycle Guy says:


          You probably already know this but your alternative news sources can be found on Rumble and Locals.com

        • Crunchy says:

          Wife and I are looking for replacement china, and we’re finding it awfully hard to locate a retail store with a reasonable selection to examine and choose from even here in a large metro area. Everything retail in the mall seems to be clothes and shoes, or food. Large department stores have given short shrift to the housewares (no margins, I assume), and even the nearby huge outlet cluster (150+ stores) has no place offering such goods. Anecdotal, yes, but I believe it’s telling.

        • Harrold says:

          You should hit up estate sales. You can pickup entire china sets that were barely used if at all for cheap.

    • gametv says:

      I disagree that software doesnt provide value. Take Intuit. Once you set up a business on Quickbooks, you can do the monthly reconciliation in minutes and if you are good with numbers dont even need an accountant or bookkeeper for small businesses.

      Software generates efficiency in many industries that eliminates all the old physical barriers. There is real value there.

      • joe2 says:

        For business it depends on what you need. I found around 80% of what I did in Quickbooks was stuff required by various government agencies. It was mostly irrelevant to my real business needs. Of course your business may differ. When I got a CPA to do payroll, I stopped feeding Quickbooks.

        So a lot of the “value” of business software is just in responding to the demands of government software. Without the government software creating the demands for your data you would not need most of the business software you have.

        • Charlie says:

          We just got a notice from Quickbooks that they will not support the desk top software after May 2023. We have to migrate to the “cloud” which means a monthly fee making Intuit immensely more profitable going this direction. May go back to paper / pencil and have our CPA do payroll.

        • joe2 says:

          The “sell to own” model is being replaced with the “service and rent only” model. In line with Klaus Schwabs WEF “you will own nothing and be happy about it , or else” model.

          I have nothing held captive in someone else’s “cloud” where it can be re-priced, turned off, or held hostage.

          Important business information is either in your head or important documents and contracts of record. Financial information is contained in your bank statements and credit card records. Payroll records in your CPA filed statements. Actually using these and not keeping your own records avoids any gotchas that can occur when there are differences between the two.

          Quickbooks was initially fun as I learned business and tax practices. But became tiresome, wasted too much time and was of little value. One example is that I kept a detailed record of customers and venders in Quickbooks for one business. When I sold it the buyer did not even want the data, let alone pay for it. Said it was too volatile.

    • polecat says:

      Yep. Sure is hard, dirty work hitting the censor button on a keyboard all of one hour a day, right? Talk about breaking a sweat..

      our fine host excepting, of course ‘;]

  10. Harrold says:

    I’m sure the Sand Hill Road gang are busy contacting these laid off employees to fund their next big ideas.

  11. Seen it all before, Bob says:

    I work in tech and I have heard some wild tales during the last 2 years.

    The company I work for has not given most employees a baseline raise in over 2 years. Most have been paid any incremental increases in pay with stock RSUs and EOY large bonuses. This is great for employees as long as the company stock maintains its 3X-4X premium over 2019.

    If you work for some of the companies Wolf has mentioned that lost 80-90% on their stock in the last year, it is tragic. I hope they didn’t overpay for a house on that stepped up income in 2020.

    However, some companies have been hiring from competition with generous base pay increases with the majority of the compensation in stock RSUs.
    Senior tech people generally are paid with a large % in stock. Sales people are paid on sales commissions. This is fair but I certainly would not count my chickens before they are hatched.

    This has likely been driving inflation. Once the wild RSUs and bonuses stabilize, things will return to normal.

    The wildest tale I heard was a senior S/W designer paid a 150K base with 350K yearly in RSUs maturing over the next 3 years. That is 500K/year in income. I hope his company stock didn’t crash in the last year converting that 350K to 30K. Still, 180K ain’t bad but not enough to support a multi-million dollar house. I hope they keep their job and don’t have to work for a stable company “only” paying 130K. 500K income last year down to 130K this year could cause problems with them but will help inflation.

    So much money was flowing during the pandemic.

    If I wasn’t married with children, I would have parked my RV in a tech company parking lot and banked the 500K/year as long as I could and then drove off into the great CA sunset once this insanity was over.

    • Depth Charge says:

      “If I wasn’t married with children, I would have parked my RV in a tech company parking lot and banked the 500K/year as long as I could and then drove off into the great CA sunset once this insanity was over.”

      That’s actually illegal. Living in an RV anywhere other than an RV park with all of the hookups and zoning requirements is a zoning violation. No matter what Youtubers and others say, the law is the law. The company would have to apply for and receive a temporary “special use permit” to allow for such thing.

      Lots of people decided to flout the law and make their own rules. This is one of the many unintended consequences of Jerome Powell and Company’s reckless monetary policies which have divorced shelter prices from local incomes. We need to start cleaning up the streets so that they’re not littered with illegal RVs, tent cities, etc., and start putting people back into legal shelter.

      • Seen it all before, Bob says:

        If you park your RV in a company private parking lot with their permission, that may be a perk for the job. You may be on-call 24/7 as a requirement. It would be better than a cot in your cube.

        Walmart allows overnight RV parking for customers in many cities.
        How is this different? It is private property.

        I suppose cities could regulate it.

      • Motorcycle Guy says:

        Depth Charge,

        Granted that if you have a family, living in an RV may present a problem. But as a single man, I bought a “step up” truck (Nissan NV 2500 HD) and lived in that for six years. I would park the truck in a Panera Bread parking lot over night and could wake up anytime after 6 am. to go get my free coffee.
        As a member of a Planet Fitness gym which were open 24/7 I could park in their parking lot and take a shower (and brush my teeth) whenever I wanted to.
        I’m now living in a very nice home in a SE Asian country.

        • joe2 says:

          Good for you. Are you in Phuket? That was my target. Maybe someday I’ll get back.

          I had a friend that lived in an RV in the company parking lot with no problems. The company had a gym and showers and a cafeteria. He was an eccentric genius. Very much in demand but never cashed his paychecks. That was a while back and now they probably have hundreds of rules and laws against it.

        • Motorcycle Guy says:


          I’m on the northern most island (I believe) of Luzon. Manila is northwest of me by about 200 miles. I’m in the southeast in the Bicol region along San Miguel Bay.

        • Escierto says:

          Excellent move. I was in Catanduanes last summer.

        • Prairie Rider says:

          M G,

          Nice, irrigated agriculture land around you, no? Fresh pineapple is one of my faves. Enjoy the fruits of the earth, sir.

          My motorbike is in hibernation, but the gravel bike has a fresh set of 40 mm tires with four rows of tungsten carbide studs on ’em. “Rubber (and tungsten) side down; salt crusted & slush splattered side up.”

          Cheers to you!

        • Motorcycle Guy says:

          P. R

          Cheers to you!

        • joe2 says:

          Motorcycle Guy
          PI is a very beautiful country. People are great but depressingly poor. My last trip before the lockdown was to see the rice terraces up north and the southern islands – bummed out in Port Barton. A shame it keeps getting hit by typhoons causing enormous damage.

          Hey, there is even a Jolly Bee nearby here now. Popular.

      • Cytotoxic says:

        You need to allow the construction of legal shelter, including SROs and RV living wherever I want to. Let motels rent to tenants as long as they want. That is the real principal issue here.

      • polecat says:

        ‘Jeromeallopies’?? … right up there with ‘bidenfavelas’?

        okay Wolf .. I’m going back to my troll cave now, having totally skinned all my hairy knuckles – can type no moar.. today anyway.

        • polecat says:

          Oh, and just to stay current re. today’s posted article, my troll cave is in escrow (yay!) .. but will have to find some part-time gig to supplement the ssi kickin in, so as to not deplete my newly aquired precious. Crossing nobby digits.

      • Mt dreamin says:

        You should see Bozeman, rv’s and campers parked all over on city streets. It’s public property and legal.

      • Shiloh1 says:

        I’m not in Tech Land but I’d have no problem renting RV space on my driveway with electric, water and sewer hookup. That’s why I have a strategic sewer clean out in the yard, among other things.

    • John Apostolatos says:

      Actually, if you talk to many Amazon and Google employees, this year has been a disaster for their RSUs. Yes, even the high and mighty have fallen.

      The base compensation was always mediocre or average for these workers. The big promise was the infinite growth based on ZIRP and QE that would push up the RSUs indefinitely. That is why Amazon and FB doubled their number of workers in two years: the Fed would not “allow” it.

      Wolf at least did not cry wolf about the Fed and what was to come.

      • Seen it all before, Bob says:

        Exactly! Google and Amazon stock are down about 50% from 1 year ago. They are almost back down to 2019 levels.

        2021 was a very good year if you were paid mostly in stock. It was a good year only if you sold it and didn’t hold it or use it as leverage.

        Your W2 wages for 2021 were likely through the roof since RSU vesting is counted as income whether you sell or not.

        • polecat says:

          Here’s my sentiment re. Goolag & JefferyZon..
          Phuck them All to Hell. They have nothing to offer to mankind but grift and malfeasance!

        • Shiloh1 says:

          “counted as income whether you sell if not”.

          Yes, I recall that from ~ 20 years ago, too.

    • Seen it all before, Bob says:

      FYI, RSU’s are paid at certain dates throughout the year. They are considered part of your job compensation.

      ie you could have been granted 300 shares of stock in early 2019 that are paid at certain times of the year over the next 3 years. If the stock price was $100 in 2019, you couldn’t sell your RSU it in until you incrementally vested over the next 3 years. You would have received 100 shares from this stock/year when it vested over the 3 years. In 2019, this was worth 10K if you sold it in 2019.

      If the stock price skyrocketed to 1K/share in 2020, your 100 shares of stock for 2020 would have been vesting at $100K/year during 2020.

      You are taxed at the value when your stock vests. You would have had tax withheld for 10K in 2019 and 100K in 2020. The amounts are shown as income on your W2. In 2020, your W2 would have shown a huge increase in income (100K) if you wanted to qualify for a house or Ferrari.

      If in 2021, the stock plummeted to $10/share again, if you did not sell your stock in 2020, you have lost $90K in income. You will have a nice capital loss to list on your taxes if you didn’t sell the stock.

      It is a gamble on whether to not sell your vested stock. The 10K in stock vested in 2019 would have been worth 100K in 2020 if you sold it (a 90K gain). If you held your 100K in stock from 2020, it would only be worth 10K in 2021.

      Your W2 wages in 2020 would have shown a huge wage increase. Your W2 wages in 2021 would have shown a huge decrease,

      Don’t count you chickens until they are hatched but your dream W2 wages may qualify you for your dream house.

    • Apple says:

      Next time you fly out of LAX, see if you can spot the remote employee parking lot that airlines employees live in.

    • Sven says:

      Any signs with ‘Will code for food’ popping up yet?

      • Seen it all before, Bob says:

        It reminds me of the 1980’s when PhD Russian physicists and scientist immigrants were driving taxis since there were no technology jobs.

  12. A says:

    The media is lying again, the layoffs have been tiny. Meta laid off 11k after hiring 33k in the last 2 years. So they’re still +20k employees in the last few years. Amazon had one of the largest layoffs yet it was actually just 1% of their headcount!

    Compare this to the 2019 “good times” when “good times” Tesla was laid off 10% of staff as a normal thing.

    The media is pushing a narrative that isn’t based up by data (but what else is new?)

    • qt says:

      To me, this is good news! It means inflation will stay high and longer.

      JPowell, keep raising the interest rates!!!

      • Anthony A. says:

        I sure hope so as I am waiting for the 7% 10 year treasury to surface. Once that shows up, I will back up the truck!

        • DawnsEarlyLight says:

          You will need an ambulance before that happens.

        • Seen it all before, Bob says:


          I have the same plan. I dream of retiring with a guaranteed 7% return for 10 years. It has been a long time since any ROR that high was guaranteed.

          However, it would be my luck if inflation was not beat and the Fed decided a 8% inflation rate is good enough. For this reason, I will only unload half the truck and wait. I’ve never been good with timing the top or bottom.

        • Harvey Mushman says:

          @Anthony A.
          In the mean time, buy treasury bills using the ladder technique.
          No reason to wait around for the 10yr, unless you currently have some other investment that returns more than 4.5%.

        • Augustus Frost says:

          Do that and it will be before rates “blow out”.

          That’s what’s in store now that the 39YR cycle bottomed in 2020.

        • Anthony A. says:

          Harvey, I am currently laddering up to one year T Bills bought at auction. And also have some juicy CDs in the pot.

        • Swamp Creature says:

          I’ve got a hot tip. Buy 30 year Treasury Bills using 10 to 1 leverage which is the max allowed. When the recession hits in early 2023 the Treasuries will rally, and you will make $10 for every $1 in price increase of the bonds. Invest $10,000 and make $100,000. It’s called “Shooting the Treasuries”. You can’t miss and you can’t get hurt.

        • Harvey Mushman says:

          @Swamp Creature,

          But if interest rates don’t go down… you’re screwed, right?

  13. John Apostolatos says:

    “The media is lying again, the layoffs have been tiny. Meta laid off 11k after hiring 33k in the last 2 years. So they’re still +20k employees in the last few years. Amazon had one of the largest layoffs yet it was actually just 1% of their headcount!”

    I am afraid you are seeing the whole picture. Meta will not renew contracts for 30k contractors in 2023. Musk let go of 5,500 contractors. Microsoft’s contractor layoffs are significant also.

    As such the combined effect is not really being felt since the full-time jobs are getting the attention and not contractor layoffs and furloughs.

    • A says:

      Media: “layoffs everywhere nobody will have a job soon!”
      Reality: marginally employed & paid contractors are losing contracts… and most of them don’t even live in the USA.

  14. gametv says:

    Why are we surprised that inflation is still roaring and labor markets are hot when the Fed has 8 billion on the balance sheet and the Federal government is spending money like there is no tomorrow?

    The junkie is still taking 8-balls in the bathroom, so he hasnt crashed yet. It will come. Wait for home prices to get back to 2018 levels in a year from now and still headed lower, that will take some froth out of things.

    • Old school says:

      A lot of leading indicators say recession is 3 – 6 months away. One year Treasury yield being the high point on the Treasury curve is a warning sign as well. Labor is lagging indicator.

      • DawnsEarlyLight says:

        FFR greater than the 3 month T-bill will definitely be a warning of things to come.

      • Petunia says:

        Recession is here now. Went Xmas shopping yesterday, nothing fancy. Xmas tree lights were $40 at Target, no wonder the store was not busy. None of the stores at the big box mall were busy. This is where America shops and it was basically dead.

  15. Augustus Frost says:

    The employment market is still tight because credit conditions remain very loose. Loose credit conditions aren’t just interest rate levels (FRB rate hikes), it’s whether anyone will lend to you at all and on what terms (corporate covenants).

    I’ll make the same comment i have made before. Wait until the stock market actually falls hard which hasn’t come close to happening. It’s happened to companies profiled on this site, but not to the ones that account for most of the index values.

    There is nothing like a crashing stock market to generate mass pink slips, just like in 2008 and the dot.com bust. Corporate America still expects any economic weakness to be mild or temporary, to the extent they actually expect it at all.

    Same concept for the performance of the corporate bond market. It’s harder to borrow now than a year ago, but very easy historically.

    • DawnsEarlyLight says:

      Yes, we’ve experienced just vapors, rising from the real pile of dung!

    • Swamp Creature says:

      Was in my credit union today. They are offering 4% on a one year CDs. I think I will take them up on their offer. They also told me the RE market here in the Swamp, is dead as a doornail thanks to J Powell. They’ve made only 1 mortgage loan in the last month. I see many who live off the RE industry here falling on hard times. You may see some of them flipping hamburgers in MacDonalds or working the cash register at the Dollar Stores, and mark the end of the tight labor market

      • Harvey Mushman says:

        Swamp Creature,
        The 1 year treasury bill is paying 4.72% and is exempt from state and local taxes.

  16. BS ini says:

    SPX 2800 PE 12
    The data shows a clear view that recurring claims are rising but still at historic lows .
    I too believe that markets need to drop below 2020 levels before the inflation drops significantly.

    • Augustus Frost says:

      S&P 500 of 2800 will not equal a P/E of 12. If it declines to that level and stays there, earnings are in for a crash landing.

      Not that it matters since valuation wise, earnings aren’t even real money. It’s a number in an accounting ledger.

      • Bs ini says:

        Regardless of the level I picked a number based on current earnings or maybe forward earnings the point is pain from wallstreet stock evaluations I think is needed as well as employment for inflation to drop significantly. Earnings will contract as well maybe inflation maybe not . Employment no where near recession levels but the picture can change fast

        • 0ld school says:

          Saw an interesting cart of market cap/GDP. That indicator is falling like a rock.

          Market cap is down and nominal GDP is up. It means if nominal GDP keeps running hot and the market keeps shedding some points the bottom isn’t as far down as I thought (1500).

        • The Real Tony says:

          That makes sense although even at those levels the stock market would still be overvalued.

  17. Bobber says:

    I wet to two Dollar Tree stores today and both were closed at 3:00pm, citing inability to staff the store, on a door sign. We may have a surplus of jobs now, but are they jobs anyone would want?

    If you only count decent jobs that pay above poverty level, perhaps we have a shortfall.

    • American Dream says:

      Sounds like those two dollar trees you visited are going to need to be renamed 2 dollar tree lol.

      Gonna have to pay more at min pay type jobs to get workers, then gonna have to charge more to pay for workers.

      Can’t just raise minimum wage workers pay without raising others pay also as to stay equitable and things stay tight because nobody wants to move the needle.

      Price discovery for jobs market seems similar to housing except there moving in opposite directions

    • ru82 says:

      Local restaurant used to be open 6 days a week. Closed on Mondays. Now it closes on Sundays too and shorted working hours because the lack of staff. The staff is actually a lot happier. They get off Sundays and they get off of work at 9pm instead of 10pm

    • two beers says:

      @Bobber: “If you only count decent jobs that pay above poverty level, perhaps we have a shortfall.”

      Good point.

      @American Dream: “Can’t just raise minimum wage workers pay without raising others pay also as to stay equitable”

      Really? Who decides what is “equitable”? According to the free marketeers, isn’t the Almighty Invisible Hand of the Market supposed to determine wages and prices? If essential workers are now given slightly better pay because their bargaining power has increased, then the compensation for software coders has to be jacked up proportionally so that the latter can still feel superior to the grubby people below them on the economic ladder? wtf?

      • American Dream says:

        Not my point at all….The invisible hand is exactly my point and not software workers which everyone loves to hate on I assume they make plenty for what they do. Let’s take nurses for example. Someone whose job it is to literally keep people alive. McDonald’s worker gets 20 an hour and a nurse doesn’t get much more then that even though they take on way more responsibility and stress. The nurse will feel under appreciated and want more money as they should. That is my point in a nutshell. Pay should be equitable based on responsibility and ability

        • Seen it all before, Bob says:

          If a nurse is getting paid $20/hour in a high stress job and McDonald’s is paying more, why not move to McDonalds?
          When a nursing shortage appears, wages rebalance.

          A higher minimum wage floats all jobs in that salary category.

          Higher paid salary workers are not affected as much and there are more distortions.

          In my first job, I was a Team Lead engineer for a project with a bunch of great technicians. They were getting paid more than I was even though I was directing them. Rightly so since they had very specialized skills.

        • josap says:

          My DIL is a nurse.

          If she wants to work a 40hr to 50 wk she will earn $120K a year. She currently works 2 shifts a week because it’s all she needs to live on and have fun.

          And when she needs some extra for travel, she works an extra couple of shifts a week for a while.

        • Einhal says:

          josap, and your son tolerates that?

        • VintageVNvet says:

          C’mon Einhal, this is modern times, not some subsistence level economy as was the norm,,, at least SO FAR…
          While we can certainly postulate the possibility of going back to the life of ”a man works from sun to sun, a woman’s work is never done” in USA as was the norm here in pioneer/pilgrim days and is still likely the norm for some folks, I seriously doubt it will happen here for most of WE the PEONs of USA anytime soon unless we get another Carrington Event or similar.
          And while many folks find solace, or something, being away from their spouse, many of us enjoy the time we have with them and would be happy to have spouse have more free time to share with us, eh?

        • two beers says:

          “Let’s take nurses for example. Someone whose job it is to literally keep people alive. McDonald’s worker gets 20 an hour and a nurse doesn’t get much more then that[..]”

          Ah, beautiful top-down class war. Pitting the essential workers against each other, divide & conquer, eh? It’s worked for centuries, why stop now?

          The inequity in the system isn’t that nurses don’t get three or four or six times what a hospitality worker gets, but that the utterly inessential, utterly corrupt, utterly wasteful, utterly criminal, and utterly powerful oligarchs at the top makes billions of dollars more for gambling with free money than the workers who create all the actual real wealth in the system do. But hate on the burger flippers who don’t make enough to pay rent.

          Here’s a clue: the metaphor of the invisible hand came from the same person who said this:

          “Civil government, so far as it is instituted for the security of property, is in reality instituted for the defense of the rich against the poor, or of those who have some property against those who have none at all”

          and this:

          “No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable. It is but equity, besides, that they who feed, clothe, and lodge the whole body of the people, should have such a share of the produce of their own labor as to be themselves tolerably well fed, clothed, and lodged.”

          Adam Smith despised the rich, abhorred the capitalists, and especially loathed landlords above all else.

          Everything you think you know about economics may be backwards, inside-out, and upside-down.

    • Flea says:

      Aldi is much cheaper,than dollar tree . Used to shop at dollar tree ,now not much can get stuff on sale at better prices

  18. Gabe says:

    Should be interesting to see how the labor market re-aligns with the skill demands. Who’s going to train these white collar workers blue collar trade skills? Who’s going to want to start over mid-life with that style of work? The only way the next generation (Gen Z) succeeds and maintains US global strength is by erasing most of, and transferring some of, the largest asset bubble wealth in history from Boomer 401(k)s and real estate. People laugh, but it will happen. If it doesn’t, say goodbye to the birthrate…bigly and quickly. Uncle Sam won’t have that.

    • Robert Hughes says:

      A study of job openings indicates approx 75 / 25 ( non college degree required vs degree required ). Labor supply is approx opposite 25 / 75. This is amply indicated by all the help wanted signs for 12 to 15 dollar an hour positions on most fast food, retail outlets, etc. A very large mismatch.
      This mismatch is amplified by all the liberal arts majors who graduate with large $$ student loans, but expect to earn big dollars. The BA barista phenomenon, limited skills, big expectations having been fed the ( you are special ) line by the universities for 4 – 6 years. Good times, cheap money, wokeism, ESG, high stock values, and many were taken into Corp world, tech world. Now as Corps begin or are looking more to bottom line, esp as interest payments increase or loans are rolled over at higher costs they realize many taken up don’t produce or deliver enough value to retain.
      Winnowing starts and will only accelerate in the coming months. Those who had enough time to develop skills, value will be in demand if they hustle and can be flexible. Those who did not and are still believing the college hype will face a much tougher time.

      • American Dream says:

        Totally agree the way college has operated is a big part of the problem with labor in America. Deff contributing to job satisfaction being at all time lows. There’s simply isn’t enough good jobs for how many people are told that if they get a degree they’ll get handed a good job. It’s saturated the market segment for sure. Now you have kids with huge debt and limited earning power and now we’re shelling out debt forgiveness as a consequence which will lead to more consequences of course

        • CreditGB says:

          Total failure of education system to turn out workers with saleable skills, and encouraging pursuit of degrees with zero use, and zero demand after graduation. Those are the ones left with debt for which their degrees and skills have no prospects to service.

          When will academia be held to account for turning out useless workers in useless disciplines? They NEVER are expected to refund their payment for a failed product.

          Cure that and you will see a vast change in productivity.

        • Augustus Frost says:

          Abolishing federal student loan program will solve most of this problem. Another example of offloading risk (by the degree awarder) to the taxpayer. More moral hazard. The worst are usually for profit organizations.

          The other side is the increasing credentialization of the economy and labor market.

          Employers require diplomas and certifications for all kinds of jobs which do not need it. (It’s another racket.) They can get away with it because there are so many degree holders versus the past.

          It would also be easier for diploma holders to find employment if the government didn’t decrease their bargaining power through lax immigration.

        • josap says:

          An AA deg was required by Starbucks to even apply for a job. That is silly.

          Kids were told an AA was now equivalent to a high school diploma. So they got the deg required to earn a just above min wage job.

      • Old Ghost says:

        LOL. Since Robert Hughes raised the issue. How many of the college STEM grads do anything that is useful (or productive) in the “real economy”. ? ? ?

        How much of what they do is just changing the color of buttons on some electronic device? Or converting simple, easy to use systems to overly complicated and almost unusable ?

        In my lifetime, I have seen telephones (and answering machines) go from being inexpensive and relatively simple and easy to use devices, to being overly complicated POS. I am thinking Tracphone here in particular, and AT&T.

        IMHO, a lot of those STEM grads should be flipping burgers for $7.25 in flyover country,……

        • Seen it all before, Bob says:


          In my early career, so many relatives wanted me to fix their TVs/toasters/appliances using my Electrical Engineering degree. Now, I tell them to go buy a new one. It’s often cheaper with mass production.

          Now they want me to teach them to operate their TV. As an engineer, I wouldn’t have designed the user interfaces that way.
          Somebody did.

        • Seen it all before, Bob says:

          I think that’s why Apple and even Microsoft have dominated. Their User interfaces are much better than cheaper solutions. ie Linux/Android.

        • Seen it all before, Bob says:

          As an old engineer, I may have been biased to what I was used to.

          ie A TV screen app with a clunky looking dial with numbers that emitted chunk, chunk, chunk to the TV speakers every time I turned the channel. :-)

          My other gripe is that electronics are no longer designed to be fixable by anyone. It is cheaper to replace the old system with a brand new one.

          Of course, it is much easier to lift a 50″ flatscreen TV now compared to an old 40″ tube TV.

        • CreditGB says:

          To extend Old Ghost’s point, a PhD Gender Studies graduate with a $7.25 per hour job has to service a $60,000 loan.

          The only “skill” they develop, IF they are even capable of that, is bitching about management/labor wage gap and squealing about living wage in the only paying work they qualify for, burger flipping.

          Where is the demand for the Academic refund of good money paid for a fake product that is unfit for use? Isn’t that fraud?

    • TheAltonRoute says:

      Coders will have to learn how to work in a coal mine?

  19. two beers says:

    Wolf, have you seen layoffs dot fyi? You may find it highly relevant. It documents layoffs in the tech and tech-adjacent sectors since the beginning of the pandemic. It’s presented as a spreadsheet, breaking out layoffs by company, location, date, industry, #’s laid off, funding stage, etc. The top two graphs on the Layoff Charts tab are eye-popping.

    • Wolf Richter says:

      Yes, been looking at it for months. I don’t find it useful for what I do. It’s global layoffs, with lots of non-US layoffs, which I don’t care about. You can sort by country, but you get every little thing, a gazillion tiny companies with tiny or even zero layoffs. That’s just not useful for getting any kind of macro perspective. There are ALWAYS layoffs with small companies… they struggle, run out of cash, and lay off people, happens every day, every week, every year, and to see that list of tiny layoff by tiny layoff and not know where that was three years ago is not useful for me at all.

      If I am interested in which specific company laid people off, I just google that, which is easier and I get much more complete info. And I can look at the WARN reports, etc.

      I think it might useful for recruiters. And I think that’s its purpose.

  20. JJj says:

    In my opinion, the reason there are so many unfilled jobs is simple.

    High skilled Boomers are retiring or dying and that process will be continuing to accelerate until they are all gone.

    I am a Boomer and when I was born, WWI veterans were in their early 50s.

    The last WWI veteran died in 2011 at 110 years old!

    Time marches on.

    All the high skill Boomers that I know, said they retired because they were tired of “Babysitting” the “New Guys.”

    A retired CPA Boomer friend told me freshly graduated Accountants with an MS, had a very poor grasp of Journal entries etc.

    He called them “Mr. Forced Balance”

    To be continued…………

  21. Dichotomy of news:

    Aggregate data shows tight job market.

    News reports say computer science graduates having hard time finding work.

    Aggregate data should be broken down by wages offered for infilled job.

    As others have said, not being able to find a fry cook at minimum wage is not the same thing as a shortage of tech talent.

    Data that does exist, like number of applicants per job on indeed or linked in, broken down by pay band, does not seem to be reported, oddly.

    Why is that…..

    • Wolf Richter says:

      In the recruiting business, nearly everything is now initiated by bots. Numbers by job sites are becoming useless, like Twitter followers that are just bots.

  22. Rob says:

    I’m going to discount the number of job openings, as I know many companies in dire straits will post a lot of openings to make it look like they’re healthy and growing, while simultaneously begging investors for even more cash to burn as they quickly go down the toilet.
    Two previous companies I worked for did that very same thing. One went out of business shortly thereafter with all those jobs still listed, the other got a lifeline after suckering in more idiots to invest, yet never filled one position.

  23. Hours worked is never mentioned as long as staff remains “full-time”. However, with slow downs, a lot of personnel lose overtime they have come to depend on as part of their normal wages. Manufacturing jobs are generally what I refer to as blue collar/white salary.

    These changes in total compensation aren’t tracked very easily but when many people buy these big trucks with massive payments they suddenly aren’t able to make payments and can get behind quickly.

    We are in a catch-22 now. Either you fight inflation and the interest rates kill the flow of money or you allow prices to rise and you kill the consumer. Pick your poison.

  24. ru82 says:

    I am digging these lower oil prices. It looks like we are about to break below 70 and gas will be hitting $ 2.5 a gallon. That is going to my household $1600 in gas expenses next year versus this year.

    • ru82 says:

      Save $1600 or more next year.

    • The Real Tony says:

      I think its a ruse because of the Christmas buying season brought to us by the same people who rig the U.S. stock market. Artificial can’t last past Boxing Day. These shysters would do anything to bring up 4th quarter GDP. I’m looking for $100 a barrel oil this February or sooner.

      • Z33 says:

        Per the EIA, gasoline demand is 600,000 barrels a DAY less than the same time a year ago. Demand is falling and prices follow. Now if we have sufficient oil production cuts, we could see $100 a barrel, but I don’t see that happening. Demand should keep dropping as this recession continues and supply cuts won’t be enough to prop the price. 7%+ drop in gasoline demand volume (both 4 week avg and this week compared to last year). That is significant.

    • Xavier Caveat says:

      I wish I could put more than a few gallons of 87 octane in my safe deposit box.

  25. Poor like you says:

    Major layoffs will begin in 2023.

  26. Citizen AllenM says:

    I am so tired of reading about how $15 an hour should attract hordes of unemployed people to worship the business- but when most of the employers don’t offer a steady 40 hours at that pay- instead just enough to keep employees sort of showing up. Meanwhile the costs of living pushed to new highs while wages had downward pressure from illegal immigration.

    Come to reality- in major cities $15 an hour constitutes a survival wage. So a crappy two bedroom apartment is going to run $1500 a month- to that is one full time survival job just to pay the rent. Food, car, etc. All that must come from a second wage earner, or two jobs. In short, this entire society is out of whack with regard to costs.

    But hey, kids, just work as hard as the poor illegal immigrants and you to can succeed to living four to an apartment sleeping in shift.

    What a miserable life we are promoting, and we wonder why socialism is starting to become popular in the younger crowd.

    Layoffs in tech are small taters to the bulk of America. Now these big tech disruptors like Carvana- they go nationwide. Meanwhile, finance, health insurance, etc is ripe for more layoffs- after all, look at the all the phone calls selling unneeded services, and health insurance burning up my phones. Totally wasted efforts are amazing in this country.

    Yet customer service keeps getting worse, and every company that outsources to foreign call centers to save a few dollars ends up paying in unhappy customers.

    A huge chunk of the economy is just wasted money in this day and age. Advertising is dysfunctional, and that is why newspapers died. What exactly was the newspaper selling when the internet came along? Look at Wolf making it as a one man band in this day and age, but the companies just can’t get the idea that many overlarge organizations are just toast.

    What exactly is the point of keeping the crazy car sales model that still is used? Lot lizards? Really?
    Finance as a separate adventure? Please.

    I hate shopping for so many things because of the bezzle.

    As the information society crushes so many business models, just think about how many people have been benefiting from the first mover in the tech space like airbnb. Now comes the inevitable shakeout from the overinvestments. I walk past empty house that are “airbnbs” with hardly any renters. Dead loss baby. Sell those houses before the value drops below your purchase, oops, too late!

    Look at the tech darling- bitcoins and minor coins. All this value in an electronic beanie baby. Ultimate value, pffft. Look at China essentially outlawing it. Plus the lie that it is untraceable. Dead loss baby!

    We said these days would come, and here they are.
    Boom turns to bust, and the wheel turns again.

    • Cytotoxic says:

      “you to can succeed to living four to an apartment sleeping in shift.”

      Then promote housing liberalization and ending rent control. Oh and of course, minimum wage must die.

      • 91B20 1stCav (AUS) says:

        Cyto – your solutions were present and practiced in the Gilded Age-what happened? And WHY???

        may we all find a better day.

        • Cytotoxic says:

          What happened was an era of unprecedented prosperity that rocked so hard the losers who hated it had to invent ‘robber barons’ and other fabrications to attack it.

        • 91B20 1stCav (AUS) says:

          Cyto-as neither you, or I, were extant then, it’s still not clear to me HOW, if things were so peachy, a significant number of the ‘losers’ you refer to could have EVER reached the critical mass necessary to effectively offer resistance or generate socialist movements in response to the very real depredations of the monopolists and oligarchs that had arisen by that period?

          Would very much like more detail on how ‘Robber Barons’ were ‘invented’. Might be more a case of those nouveau-riche ‘Barons’, akin to failing national royalties, neglecting the performance of adequate ‘noblesse oblige’ towards their ‘subjects’- leading to the subsequent creation and reaping of the ongoing whirlwinds of socialist/reactionary movements and the first truly World Wars…

          may we all find a better day.

  27. Swamp Creature says:

    There should be no unemployed people in this country. We have millions of job openings with no one volunteering to fill them. I propose that as long as this is the case all unemployed people should either take one of these jobs or be assigned a job. If it works in the military, then it will work for civilians as well. If they don’t do either than all of their unemployed benefits should be terminated. It’s time for all the freeloaders to go back to work.

    • Bobber says:

      If you are serious about chastising freeloaders, why you oppose the IRS going after people who don’t pay their taxes?

      You’ve made numerous comments opposing IRS budget increases needed to go after big tax evaders. These are the biggest “freeloaders” in the country, aside from the blood-sucking Wall Street financial arbitrage complex.

      • Swamp Creature says:


        Blame Congress. They are the ones that passed these tax laws.

        The IRS now gets all of their money from wage earners that is due. They have all the data before you even turn in your return. What we don’t need is 80,000 IRS agents going after little mom & pop business or small entreprenuers making a few $600 deals on the side. This is in the new tax law getting ready to be passed. Your reward points on your credit card will also be 1099ed. Enjoy.

        • Bobber says:

          I get it. You’d rather make somebody else pay the tax on your side income.

        • OutsideTheBox says:

          Can’t you just smell the virtue oozing from SC’s post ?

          He claims the good ole USA has job for EVERYONE. According to him, those jobs just haven’t been ASSIGNED. Yes, everyone WILL work or they will be forced.

          Of course he objects to paying taxes on his “side deals”.

          So much virtue and hypocrisy it beggars belief.

      • Cytotoxic says:

        1) The IRS is literally going after people to pay those freeloaders. Not letting people steal my money =/= freeloader

        2) The Wall Street financial arbitration complex generates immense amounts of value. You have no idea how awful life would be without it.

    • two beers says:

      The banksters, vulture capitalists, and crypto Ponzi scammers are the freeloaders, not essential workers who refuse to risk their lives for your benefit for less than poverty wages.

      • Cytotoxic says:

        None of those are freeloaders. They generate immense value or at worst burn those with more money than sense.

        • two beers says:

          Please enlighten us as to the value created by the likes of Charles Ponzi, Ken Lay, Bernie Madoff, & SBF, and all the blowers of financial bubbles and perpetrators of financial terrorism down through the centuries.

          They’re not just freeloaders, they’re fraudsters, and arbitrage psychos, and would push your grandma in front of a bus if they were named on her life insurance policy.

          They don’t just burn through those with more money than sense, but they wipe out the life savings of the marginalized fixed (or no) income members of society.

          Glory to the psychopathic Galtian heroes! Ruin to those who don’t have an MBA or immense family wealth!

          What the “heck” is wrong with you people?

        • Wolf Richter says:

          two beers,

          Hahahaha, I thought Cytotoxic was kidding. That’s how I read it. Maybe he was serious. That would be troublesome :-]

        • Cytotoxic says:

          Only SBF had anything to do with crypto in that list. None of the rest have anything to do with crypto or the brilliant financial engineers who make our world work.

    • two beers says:

      “I propose that as long as this is the case all unemployed people should either take one of these jobs or be assigned a job. If it works in the military, then it will work for civilians as well. If they don’t do either than all of their unemployed benefits should be terminated”

      There’s a system of political economy that aligns with this. It begins with “fasc” and ends with “ism.”

      • Swamp Creature says:

        two beers

        Everyone that signs up for military service gets assigned a job after they complete their boot camp. I don’t call that “fasc” and ends with “ism.”

        I call it serving your country.

        • two beers says:

          Silly me, I always thought there was a difference between being a civilian and serving in the military. Thank you for clearing that up!

        • Cytotoxic says:

          It’s slavery when you’re forced into it.

        • OutsideTheBox says:


          Massive metaphor failure on your part.

          The military world and the civilian world are apples and oranges.

        • Swamp Creature says:

          Bring back universal Military Service. That will solve all the above problems.

    • billygoat says:

      The jobs aren’t filled because the pay isn’t enough to cover the rent. Why work and not afford rent when you can just not work, and also not afford rent. Forcing people to work is called slavery friend although I’m sure that’s not what you mean. Let’s get these rates up and fix housing like the fed has said they’re trying to do a few times in some of their little talks.

  28. Dang says:

    Thank you for such an extensive analysis of the jobs market.

    I have been skeptical of the jobs data for 50 years. It seems to me, that in the glare of retrospect, it has an absurd track record as the so called leading indicator it purports to be.

    I am considering a different interpretation of the jobs data. And what may be happening.

    • Dang says:

      I don’t know for sure, but I suspect that the population is pushing back against the miserable, low paid jobs, that the Chinese importers are offering.

      Adam Smith provided a great quote pertaining to the Chinese importer class, the merchants. Adam Smith:

      ” People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices . . . though the law cannot hinder people of the same trade from assembling together, it ought to do nothing to facilitate such assemblies.”

      “to widen the market and to narrow the competition, is always the interest of the dealers . . . to narrow the competition must always be against it (the public) . . . the proposal of any new law or regulation of commerce, which comes from this order, ought to always be listened to with great precaution.”

      • Dang says:

        We shall see how the Fed’s plan to withdraw $1.7 trillion of liquidity from the US economy next year affects the current labor preference.

        Will it increase the supply of people, desperate for income to fill the, mostly, bad pay and benefits jobs being offered. I don’t believe for a minute that there isn’t a plethora of pretty good people available to fill those jobs for good pay and benefits and a long term future.

      • Dang says:

        I should have said that I plucked those Adam Smith quotes from a website: The Imaginative Conservative.

        Specifically from an article by Drew Maglio titled:

        Why Adam Smith’s Critique of Mercantilism Matters Today

        I have no affiliation with this website other than citing their presentation of Adam Smith’s words.

    • Dang says:

      I am willing to listen patiently for five seconds to anyone interpreting the lay of the labor market statistical bones to predict the future.

      There certainly is a lot of practitioners of the dark art of infinite optimism, stock sales persons.

      As we endured since October, there is never a bad time to buy the right stocks.

      • Dang says:

        Always mindful of the fact that today’s fool is often tomorrow’s genius.

        Einstein is an example. Impossibly predicting particle physics that are being proven to this day.

        • Prairie Rider says:

          In July 1902 Einstein began his “cobbler’s trade” working in Bern as a patent examiner. He called it, “That worldly cloister where I hatched my most beautiful ideas.”

          To me, in the world of electric vehicles, Mate Rimac is today’s genius.

        • 91B20 1stCav (AUS) says:

          Prairie (DanRo?) – wasn’t Einstein noted later as often traversing the campus shoeless? ‘cobbler’s trade’ at heart, here?

          may we all find a better day.

  29. cd says:

    Well, auto looks to be next job paring sector.

    Lots look full even in the smaller auto malls, big change from last spring.

    High income loss in auto sector will cause some pain

  30. Logan Kane says:

    Wolf, et al.:

    When do we think consumers’ excess savings will run out? My feeling is that’s when the raging inflation runs out of fuel. Jamie Dimon suggested about mid-year 2023.

    • CreditGB says:

      Logan, I too see the savings rate charts that show them dropping. What a financial plan, drain your savings to pay for necessities, then run the CCs up. Would be interesting to see what income levels are draining their savings, and who exactly is running up credit cards. Maybe even see who are employed, unemployed, and out of the workforce. Just how are each group treating savings and credit card use. But I suppose that kind of info is privy to the CC companies only.

    • Wolf Richter says:

      Logan Kane,

      “Savings” doesn’t saying anything (zero) about what consumers have in stocks, bonds, real estate, in their 401k, etc.

      The green line shows total deposits at commercial bank, which includes households and corporate accounts, nearly $18 trillion, up from $13 trillion before the pandemic:

      And this is what households have in just their checking accounts as of Q3 2022 (checkable deposits, nearly $5 trillion. That’s gonna take a while to burn through:

      • SR1 says:

        All that money, and not many ways to spend it productively. Thanks Wolf.

        This by far is the most valuable site I read.

    • DawnsEarlyLight says:

      Are you kidding me? 10 plus years of money making! There is a $hitload of money out there!

  31. CreditGB says:

    Q: “When Will the Waves of Layoffs Loosen this Crazy Labor Market?”
    A: Gov’t subsistence has become the “easy” way to live. Comfortably poor is a rung on the economic ladder now and it is highly magnetic.

    • Visigoth says:

      “Comfortably Poor”; You speak the language of ignorance. Anyone poor in the US has to rely on a system of assistance that is so convoluted, twisted, punative, Byzantine and dehumanizing, that many people would just rather starve than have to navigate it, and subjugate themselves to it’s micro-manipulation of their lives.

      CreditGB, you talk a very ignorant line. You need to get out more.

      I’ve also wondered if the enormous increases in homelessness is partly fed by those who just don’t have the strength left to go through it all anymore, and jump through all the hoops, fill out all the reams of paper, and have their lives put under a microscope…and repeat as the bureaucracy demands.

      “Comfortably Poor” indeed!

  32. Swamp Creature says:

    Just released. There are 7 million abled body workers between the age of 25 and 45 who are making more being unemployed than if they took a job.

    • Wolf Richter says:

      Are you saying they’re day traders and making money that way?

      Or are you saying that they’re receiving unemployment compensation???

      If you’re saying that these 7 million 25-45-year-olds are receiving unemployment compensation you’re telling a lie. It’s a lie because there are only 1.67 million people receiving unemployment compensation.

      If that’s what you mean, who is spreading these lies? Where do you pick up these lies?

      • Swamp Creature says:


        I believe I heard this number quoted on Fox Business News, which is the only conservative news broadcast in the DC Metro Area. They didn’t say these 7 million were receiving unemployment benefits. They have just dropped out of the workforce, many living in their parent’s basement working gig jobs for cash, day trading, second class brownbaggers, drawing other government benefits. They won’t take the available jobs because the wages of these available jobs are so low, and they would lose all the government transfer payments that they are now getting.

        • Wolf Richter says:

          These people you describe are NOT “unemployed.” Unemployed has a definition. A retiree is not unemployed. A baby is not “unemployed.” A wealthy guy who doesn’t want to work is not “unemployed.” “Unemployed” means looking for work, and wanting to work, but not working.”

          If you do gig work, you’re working — and sometimes very hard. The term is “self-employed.”

          But yes, lots of people dropped out of the labor force for all kinds of reasons, many of which we discussed here, including an unusually large number of early retirements.

  33. 91B20 1stCav (AUS) says:

    Swamp – seems to beg the question of which level of ‘compensation’ between the two more closely approximates a truly adequate ‘living wage’ (mmv with demographic and geographic distribution, natch…).

    (… the bell of supply and demand tolls for we …).

    may we all find a better day.

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