WASHINGTON — Job growth in the United States has remained resilient for the past 2 1/2 years even after high inflation flared and theThe September jobs report that the Labor Department will issue Friday will show just how much of that durability remains. Additional threats to the economy have emerged in recent weeks, including, rising energy prices, the resumption of student loan payments, widening labor strikes and the ongoing threat of a government shutdown.
Fewer Americans are quitting their jobs after a surge in resignations in the aftermath of the pandemic. Most people quit to take other jobs with higher pay, so the decline in quitting indicates that workers now see fewer available opportunities elsewhere. Friday's jobs report comes at a time when the Fed is scrutinizing every piece of economic data to determine whether it needs to raise its key rate once more this year or instead just leave it elevated well into next year. After 11 hikes beginning in March 2022, the Fed's benchmark rate stands at a 22-year high of roughly 5.4%. The central bank's rate increases have led to much higher borrowing costs for consumer and businesses across the economy.
“If we continue to see a cooling labor market and inflation heading back to our target, we can hold interest rates steady and let the effects of policy continue to work,” Daly said in remarks to the Economic Club of New York. The economy's growth in the current October-December quarter could slow to an annual rate as low as a 0.7%, Goldman Sachs has estimated, sharply below a roughly 3.5% pace in the July-September quarter.