INSANE *Stagflationary* Shocker - Jobs Surprise.

oh

holy shmokers L the ADP employment

report just came out it is the precursor

of the data that we expect to get on

Friday which is the official Bureau of

Labor Statistics employment report and

wow this ADP report was a shocker now

look I actually really like the ADP

report because I think it is much more

accurate than the government's version I

think the government's version has a lot

of manipulation in it from seasonal

adjustments and potentially bureaucratic

influences that we don't know all the

details to that's not to say the private

report doesn't have any bias either but

I think it's important to look at both

reports and mostly look at what were

markets expecting and what did we

actually get and then look at the

details and the ADP employment change

this morning well let's just say it

what's the lead yeah uh the survey X

well let me first tell you the last

report the last report was 242. that was

revised up a little bit by 19 000 jobs

the reason you do that is you get some

more data and you're like okay let's

adjust the prior up a little right so

you get 242 adjust it up a little bit to

261 for February February okay fine well

now we got the Shocker the survey here

was 210 000 jobs which was already 32

000 jobs under the prior report but we

actually missed that by about 30 percent

we came in at 145. uh actually that's

that's even smaller 145 was the actual

report uh that is a Miss uh yeah Miss up

about 31 a 31 Miss 145

000 Jobs versus 210

000. now we need to go through the

actual report but that kind of Miss

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okay let's take a look at this ADP

National Employment report private

sector employment increased by 145 000

jobs in March and annual pay was up 6.9

percent year over year I want to see how

that compares because I'm pretty sure

that's down from the over seven percent

we've been used to so let's go right to

that because I think that's pretty

important pay insights here we go okay

yep 7.2 percent was the jobs gain or

wage gain in February that fell to 6.9

uh for job stayers for people who are

switching their job pay growth was 14.2

percent down from 14.4 so again no

indication of a wage price spiral but

again still a sign that wages are

growing here's the median change and

where you're seeing the highest wage

gains this is also not a shocker 9.6

percent for leisure and Hospitality

Services 6.9 for other education 7.2

Business Services 6.4 uh these are

year-over-year numbers so those are

those are still pretty high right

absolutely still too high but let's go

ahead and see if we can compare these to

the prior month just so we could get a

little bit of a look and see where we're

potentially getting some of the

softening this is uh this is the report

that was released Feb one I need the uh

I need the early March report uh okay

we'll get the early March report let's

actually let's go ahead and look at Fab

so here's Feb just to compare this is

was the Feb report which would be the

January actually better it gives us even

more of a comparison window so look at

this Leisure and Hospitality was 10.1

now it's

9.6 okay that's good you've got

education 7.2 same at 7.2 professional

business service is six nine now at six

four Good Financial activities now six

eight uh and it was seven four

information was six six now it's six

three and trade and utilities was seven

five now it's seven percent so you're

definitely seeing that pay growth uh

slowing it's still high year over year

uh and you're seeing the month over

month numbers inflecting uh but they

don't actually give us the month over

the month numbers right the way you have

to kind of think about this

is a chart where it's like pay growth

went up and then what you're trying to

do is you're trying to pull down this

moving average and then you're comparing

to it year over year right and when this

starts going down it takes a year for

you to actually kind of start seeing

that pull down so it's like you're

pulling down on a 12-month moving

average so you're not expecting to see

very very quick declines so I think this

is good across the board I don't think

there was any sector here that was

positive the only sector that was flat

compared to January was education and

again that's year over year on on your

moving average that you're trying to

Joint down right uh so so in my opinion

that's actually a good thing

so again this is the EDP report for

March I want to go through as well the

projections for Friday for the uh

employment report that'll be released at

5 30 a.m I'll be traveling uh on Friday

so I will be streaming it live as usual

we'll be streaming it via stream yard so

shout out to stream yard uh kevin.com

but what I really want you to think

about is uh the fact that

the jobs report is very important

because the one thing that reminds us of

the 1970s is a wage price spiral as well

as unanchored inflation expectations I

guess that's two things instead of one

thing

jobs report is a consistent in my

opinion with the softening economy now I

want to show you what chat GPT has to

say about our jolts report from

yesterday as well now that I think is

actually really interesting so prepare

for the jolts report in just a moment

and the chat GPT response to the jolts

report put together not by me but

actually put together by a Goldman Sachs

analyst you ready for this all right so

first let's hit this number right here

so this right here is our uh change in

private employment where are we seeing

job losses well we're seeing job losses

which we'll do with a pink color here in

manufacturing Financial activities

professional and business services where

are we seeing the bulk of the gains

Leisure and hospitality and you are

seeing some Mining and construction

which these are some surprises that

we're seeing construction for example

still booming that could be because of

some of the government stimulus and to

the inflation reduction act or the jobs

act or the chips act rather not the jobs

act let's see here we'll get some more

details here I like looking at this

detail here change an establishment by

size it seems like the large wow this is

actually really surprising it seems like

large establishments aren't actually the

ones getting as many jobs it's actually

smaller the smallest are the ones where

the job gains are medium and small

that's surprising you're really seeing

the the larger medium and the larger

have have barely job gains or

potentially negative that is very

surprising that the smaller ones are

reporting the drop gains and let's look

at regionally the South is losing the

most jobs as well as the West wow that's

actually really surprising as well

because I thought like Florida was

supposed to still be killing it but

South Atlantic East and Central this

would be like your your North Carolina's

uh West South Central I'm assuming that

would be like Oklahoma Texas uh anyway

negatives over here the Midwest is

actually where you're getting the job

gains as well as the Northeast now this

could be your Idaho Ohio uh uh

potentially because of jobs data and

then you've got the Northeast over here

all right that's interesting now what

did Chachi PT have to say now this was

mind-blowing in my opinion so chat GPT

basically got fed the joltz data and

take a look at this this is an analyst

report from Goldman Sachs here Goldman

Sachs was just released this this

morning I fed Chachi PT with a selection

of jolt's data and asked her whether the

jolt's data was consistent with the

decelerating or accelerating economy

this is what it came up with colon we

are on borrowed time

what I I don't want to hear that don't

tell us we're on borrowed time that's a

terrible thing to say but uh that's what

they said so let's see why they think uh

we're on a borrowed time uh it uh it's a

little scary so what do we have here

this data is more okay they fed it in

and it says this data is more consistent

with a decelerating economy a

decelerating economy is typically

characterized by a Slowdown in growth

and the data provided indicates several

signs of such a Slowdown this is chat

gpt's response folks it says a decrease

in jail job openings total private job

openings decreased 559 000 from January

to February suggesting fewer

opportunities fewer opportunities for

job Seekers decrease in hires indicating

companies might be more cautious about

expanding and a decrease in layoffs uh

it would be usually a positive sign for

the economy right however when combined

with the decrease in job openings and

hirings it could suggest that companies

are more hesitant to let employees go

due to the uncertainty of finding new

hires in a potentially slowing economy

chat jpt suggesting uh oh maybe the FED

is doing a little bit too much over

tightening so with that said make sure

you come back to the Friday jobs data

report but this ADP report suggests

slowing wage inflation no wage price

spiral it does suggest that the FED may

be over tightening and we could be

surprised to the downside with how

quickly jobs growth plummets and how

quickly the unemployment rate Rises

remember what Elizabeth Warren said the

feds projecting one percent increase in

unemployment well usually after a one

percent increase you end up getting two

and that ends up hurting more gain the

lead

yeah wrong button lost the lead