CONTRIBUTORS
Anujeet Sareen, CFA
Portfolio Manager
United States
Big Picture—Labor Growth Sluggish: Companies are raking in profits, but job growth remains sluggish. Private-sector employment is roughly 5% below its pre-pandemic trend.
Despite recent high-profile layoff announcements, private-sector job growth is back in positive territory.
Small business earnings have been accelerating, which typically leads to an increase in hiring.
Stronger earnings among small businesses (as shown in the previous chart) are a key reason hiring intentions have risen for the fourth consecutive month. Nearly 45% of all jobs are at companies with fewer than 50 employees, underscoring why this uptick in hiring intentions is meaningful.
Deregulation Tailwinds: There has been a lot of attention on economic tailwinds from tax cuts and the Federal Reserve’s easing cycle, but deregulation, particularly for small businesses, is another potential tailwind.
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