US labour market was still resilient at the end of 2022
Al JazeeraMAR 17 2023
Markets already want to know when the Federal Reserve will start making cuts. While many have warned US inflation hasn't turned the corner yet, the markets are demanding change. With the ADP report potentially causing the Fed to raise interest rates even further, it's perhaps too early to be having such a discussion.
The Fed must stop raising interest rates. Domestic inflation is driven by profits rather than wages, which interest rates don't directly affect. Impacting workers rather than businesses, the government should use other means to tame inflation such as windfall profit taxes and antitrust enforcement.
Discussion of a healthy labor market and raising interest rates often neglects the deadly fingerprints of COVID. Fed Chair Jerome Powell himself correlated a tight job market to the pandemic deaths of nearly 500K American laborers. Factor in perhaps 4M long COVID sufferers, and the picture of just why the US job market is so "tight" has more context.