Former Trump administration economist Stephen Moore has analyzed what that could mean for the macroeconomy if job growth has been significantly overestimated.
Economists largely agree that the labor market is “cooling,” but one recruitment industry veteran says that's a significant understatement.
Brian Howard is founder and president of The Howard Group, a boutique recruiting firm based in Overland Park, Kansas. The firm has been in business for more than 30 years and hires companies to fill a variety of white-collar positions.
He said the job market is in a “bad state.”
Veteran executive recruiter Brian Howard says the job market in his industry is showing worrying signs. (Joe Raedl/Getty Images/Getty Images)
Howard said in an interview with FOX Business that he noticed signs of weakness about two years ago, which became apparent about 18 months ago, and that the market has been in a downturn or slump for the past 10 to 12 months.
Private sector payrolls fall to 99,000 in August, much weaker than expected: ADP
He said hiring for technical management and sales has virtually dried up and those sectors tend to go through boom and bust periods, but the insurance industry is more “up and down” and hiring is currently in a “dire state.”
Howard has noticed that more white-collar workers are turning to independent contractors or 1099 positions out of necessity, and companies are opting for temporary rather than full-time employment.
He said the recruitment industry in 2024 is starting to look like 2009 after the financial crisis, when there was anecdotal evidence that around half of external recruitment firms went out of business.
Former Home Depot CEO and Chairman Bob Nardelli spoke about the U.S. employment data and argued that the job market is “tight.”
For Howard, another clear sign of a weakening job market is that his firm has been inundated with calls from job seekers and has seen a significant drop in requests from clients looking to hire, typically companies with 100 to 200 employees.
He said companies have told him they are holding off on hiring because of uncertainty about the economy and the presidential election.
Salaries for new hires fall in some blue-collar jobs
“We're experiencing a job market recession,” Howard said. “Even in a recession, economic activity continues. It's subdued. That's what we've seen. There's still economic activity going on, but it's significantly reduced.”
Jason Greer, president of Greer Consulting and a labor expert, said he doesn't disagree with the idea of a job market recession.
Job seekers attended the JobNewsUSA.com South Florida Job Fair on June 26, 2024 in Sunrise, Florida. (Joe Raedl/Getty Images/Getty Images)
“There are a lot of factors working against job seekers, and even people who are currently employed but looking for new opportunities,” Greer, also known as the “employee whisperer,” told FOX Business.
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Greer said while the unemployment rate is in the 4.1% to 4.3% range, the employment rate has fallen to its lowest level since 2014, which is essentially the equivalent of an employment rate of closer to 7%.
“Even though the economy is still relatively strong, employers remain wary of overstaffing in light of a potential downturn,” he added.
