The demand for American labor will weaken due to the rise in interest rates and the recovery of employment in the South, according to reported Fitch Ratings:
Fitch Ratings expects the US labor market to weaken as aggregate demand stagnates throughout the year in response to the lagged effects of rising interest rates, according to a new Fitch report.
“The $517,000 payroll growth number for January 2023 was an upside surprise that probably won’t hold,” said Olu Sonola, head of US Regional Economics. “Job growth has slowed in five out of the past six months. US labor market conditions remain very strong, but look set to continue the cooling trend into 2023.”
”The employment recovery in 2022 was dominated by the South, especially in high-wage industries such as information and professional and business services. Four states in the South—Texas, Florida, North Carolina, and Georgia—accounted for roughly 50% of job growth in the business and professional services and information sectors, relative to pre-pandemic levels. Weakness in these sectors in 2023 will likely be a drag on job growth in these four states.”
The note comes after the US annual inflation rate, as measured by the Consumer Price Index, slowed only slightly to 6.4% in January from 6.5% in December, less than market forecasts. of 6.2%, which suggests that controlling inflation will take longer than expected.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
