Karachi:
Fears of a recession have gripped America’s top economy as employment data combined with warning signs about its economic outlook. The great engine of the world economy is gradually faltering.
Data released by the U.S. Department of Labor on Aug. 21 showed that the number of new nonfarm payroll jobs in the U.S. fell by 818,000 from April 2023 to March 2024.
Labor market indicators, which are produced and published regularly, are considered important for understanding the level of employment creation and destruction over a period of time. This not only gives policy makers an opportunity to design appropriate programs and policies that reach out to vulnerable segments of the workforce, but researchers also get an opportunity to study and analyze trends.
Noted economist Jameer Ahmed Awan opined that „America is a declining superpower.”
The US economy is not as hot as the Biden-Harris (Joe Biden and Kamala Harris) administration is campaigning. Former President Donald Trump responded to a downward revision to his True Social account, calling it a „massive scandal” that showed the labor market was weaker than the Biden-Harris administration claimed, the New York Post reported.
The Russian Satellite News Agency reported that the labor market is seen as the engine of the US economy’s recovery from the Covid-19 pandemic, and that the correction highlights the weakness of the US labor market.
According to an Associated Press article, the revised data further demonstrates that the U.S. job market is slowing steadily and could strengthen the Fed’s plan to cut interest rates soon.
The Federal Reserve’s next monetary policy meeting will be held on September 17 and 18, according to the latest data from the Chicago Mercantile Exchange’s Federal Reserve monitoring tool.
Recently, there has been some conflicting news as US job losses have seen stock prices fall and then recover. The US economy is falling prey to recession, but not collapse.
BBC News reported that Federal Reserve Chairman Jerome Powell (chairman of the U.S. central bank) said the „time has come” for officials to cut interest rates, but he gave few clues as to how quickly or how far borrowing costs would fall. .
The central bank faces a dilemma, if it loosens too much, it may lead to some kind of rise in inflation and if it loosens too much, growth may weaken.
Senior Economist Dr. Sabur Kaur said, „However, this is no area of concern for those in the policy and program-making domains in countries like ours. In fact, we rarely worry about accurate and timely monitoring and reporting. Labor market trends are, at times, an unknown phenomenon in this part of the world. Not.
It is not uncommon for disillusioned and disaffected youth to opt for illegal practices. Karachi is well known to demonstrate one such phenomenon. Deteriorating law and order situation in other cosmopolitan cities including Islamabad is an area of concern, he said.
„This predicament is very different not only from Western countries, but also from countries like Singapore.”
For example, looking at US labor market indicators, the situation rang alarm bells when 14.83 million people were reported unemployed in 2010. Later years brought some degree of normalcy.
However, due to the Covid-19 pandemic, the number of unemployed people rose to 12.9 million in 2022. Has this trend continued? No! This is mainly due to the return of economic activities.
„The number of unemployed has risen to 7.16 million in July 2024, which, in my opinion, will continue to be monitored, and apart from the existing social safety nets, labor market programs are expected to be launched. Take a downward trend,” he said.
The number of unemployed youth aged 16-19 has increased from 11.3 million in 2023 to 12.4 million in the current year.
Those at the helm of affairs in Pakistan are urged to continuously focus and monitor labor market trends to design appropriate mechanisms to reduce employment destruction and increase job creation by tailoring appropriate policy and program responses.
The writer is a staff reporter