Layoffs Are Up! All Other Labor Measures on Yellen's 'Dashboard' Are Down
NEW YORK (TheStreet) -- The labor market is still in the pits. It's improved a lot since its 2009/10 nadir, but it's still weak compared to pre-recession levels -- and even more so relative to long-term trends of employment growth.
This according to a "dashboard" of labor-market indicators that Federal Reserve Chair Janet Yellen has talked about of late,* a dashboard that she says she and the Fed will use to help determine the state of the economy and determine monetary policy.
The folks at RecessionAlert have been nice enough to read my mind and display a dashboard of nine of those indicators in just the form I desired, saving me the trouble of preparing it for you. They've also added a handy average of the nine.
For your delectation:
Only one of those 10 indicators -- layoffs -- has achieved new highs since the downturn, by this method of display. It achieved that remarkably quickly, by 2010, and has remained above that level ever since.
Can you say "dual mandate"? Any Fed assertions to the contrary notwithstanding, the Fed is always more concerned with inflation than employment (even during times -- like now -- when inflation and all measures of inflation expectations are at historic lows).
Takeaway: With inflation and labor indicators all in the pits, don't expect any significant monetary tightening from the Fed until mid-2015 at the earliest. Only eight of 18 primary dealers expect tightening by that time, according to an April Reuters Poll.
* The dashboard term actually seems to have been coined by Robin Harding in a March 2013 Financial Times piece. Jeff Kearns of Bloomberg News picked it up in a question at Yellen's March 19, 2014 press conference. Yellen used it a couple of times in her responses, and it's since become widely current.
Steve Roth is an investor and serial entrepreneur in Seattle. He blogs at Asymptosis.com.
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