July 9th, 2022 | Labor Market, Employment, Growth Stocks vs. Value Stocks, Car Manufacturers, Pfizer Vaccine & S&P500

<p>Labor Market Friday's job report will be a very important indicator for how the job market is holding up with inflation concerns and rising interest rates, but today we got the data for the JOLTs report. In May the labor market remained strong as there were still 11.25 million job openings. This far outweighed those counted as unemployed as it stood at 5.95 million people. This means there are still about 1.9 openings per available worker. The quits rate also declined but it still stood at 4.27 million for the month of May. While both data points have fallen from recent record highs, overall, I still believe the labor market remains strong. Due to the strong labor market and no signs of excessive leverage, I believe the recession being discussed will be mild. Employment The employment numbers did not disappoint today, and they provide further evidence for an economy that I believe will be ok. The establishment survey showed payrolls grew 372,000 in the month of June which blew past the estimate of 250,000. The previous 2 months were revised lower by a total of 74,000 jobs, but overall, I would still say it was a good gain. The establishment survey is now just 524,000 jobs lower than pre-pandemic levels and if you look at the private sector it is actually 140,000 payrolls higher than February 2020. The household survey showed unemployed persons now stood at 5.9 million, which is just slightly higher than February 2020 when it was 5.7 million. Two areas that remain troubling are the labor force participation rate and wage inflation. The labor force participation rate still stands at 62.2% which is below the February 2020 rate of 63.4%. Looking at average hourly earnings we saw an increase of 5.4% over the last 12 months, but that is still well below the 8%+ inflation rates we have been seeing. Growth Stocks vs. Value Stocks Numbers are in for the first six months of 2022 and for the first half of the year growth stocks fell 25% compared with value stocks falling 12%. That is a gap of 13% which is the widest in