Macro economist Henrik Zeberg has also warned that the US economy is getting too close. economic decline while labor market conditions continue to weaken.
Economists have said that unemployment poses a threat to GDP growth and, ultimately, market performance, he said in X. post on June 21.
The warning follows Zeberg’s recent analysis of the relationship between US non-farm payroll growth and economic output.
According to Zeberg, job creation and year-over-year GDP growth have been slowing, making the labor market a key component of economic health.
His chart shows that the unemployment rate has fallen to about 2.2, down from a post-pandemic risk of 7.0 in 2022.
The index is below the levels seen at the start of every US recession since the early 1970s, including the 1973-75, 1980, 1981-82, 1990-91, 2001, 2008-09, and 2020 recessions.
The economy is losing momentum
Although the economy is not in crisis, he said that these developments indicate a significant economic loss.
Zeberg’s theory is based on the idea that economic growth depends mainly on the ability of the economy to create jobs.
Under this scenario, a long-term labor market slowdown would affect consumer spending, business activity, and GDP growth.
Its outlook projects US GDP growth at 2.7% year-on-year even as labor market indicators continue to weaken. Zeberg argued that if employment fails, economic growth should follow, increasing the risks of recession.
He cited the rising unemployment rate, declining business activity, and rising consumer sentiment as signs that the economy is slowing due to historical and historical factors. stock market higher.
In particular, Zeberg says that the markets are about to collapse.
Despite his earlier predictions of a doomsday meeting, he continues to warn that the risk of a recession is rising as conditions worsen in the labor market.
In a recent market statement, Zeberg said the U.S. economy is doing well, which could lead to a major correction in stocks and other risk factors.
He said that this is due to the decline in business indicators, the decline in employment growth, inflation, and the rise in debt.
