Employment No Longer a Lagging Indicator?
Today’s 2.2% upside surprise in productivity is very interesting. As the Wall Street Journal reports:
“…U.S. firms adjusted quickly to the economic slowdown by shedding workers and cutting back on hours worked.”
…and…
Usually, productivity growth drops at the start of economic slowdowns as companies are reluctant to shed workers.
It looks like that reluctance is gone. If you are dismissing job losses as an unimportant lagging indicator, you may want to reconsider your position.
