Photo: informationstation.org
By Isaac Cohen*
After defying a policy characterized as “restrictive” by the central bank, the labor market in the United States slowed down from the creation of over 300,000 new jobs in March, to 175,000 in April, also below the monthly average of 247,000 new jobs created throughout the year ending last March. The unemployment rate increased to 3.9 percent in April, from 3.8 percent in March, while wages also decreased from a year earlier to 3.9 percent, from 4.1 percent in March. There was also a sharp decrease in economic growth, from 3.4 percent in the last quarter of 2023, to 1.6 percent in this year’s first quarter, which complicated the outlook because it coincided with a reversal in the declining trend in inflation. The personal consumption price index increased 3.4 percent during this year’s first quarter, after remaining below 3 percent during the previous three quarters.
However, despite these indicators of a slowdown, consumer spending remained strong, increasing at an annual rate of 2.5 percent in the first quarter of this year, slightly less than at the end of last year. Even so, some analysts interpreted the increasing trend in inflation, together with less economic growth, as a sign of “stagflation.” But the head of the central bank Jerome Powell dismissed this concern saying, “I don’t see the stag or the flation.”
*International analyst and consultant, former Director ECLAC Washington. Commentator on economic and financial issues for CNN en Español TV and radio, UNIVISION, TELEMUNDO and other media.
