💼 How Layoffs and Falling Consumer Spending Affect the Macro Economy
💼 How Layoffs and Falling Consumer Spending Affect the Macro Economy
Layoff announcements are ramping up as companies adjust to slowing sales and profitability. So far, significant job cuts have been concentrated in technology and consumer-related industries due to overhiring during the pandemic recovery when demand was extreme. Whether this spills into the broader economy is the subject of debate among investors and economists. With markets already expecting a mild recession in 2023, how should long-term investors maintain perspective on this topic over the next year?
We discuss in this episode of The Wealth Effect Podcast:
📊 GDP Growth Components
💼 Job Gains by Sector
📈 Household Debt Service Levels
Matt Faubion, CFP®
Founder - Wealth Manager
Show notes and charts:
The economy has slowed over the past year
Job gains have slowed with sectors such as Info Tech experiencing layoffs
Household debt service is growing
The bottom line: While layoffs are challenging for individuals, investors should maintain balance as the effects of overexpansion within sectors and higher interest rates across the economy play out. History shows that these periods often set the stage for future business cycles.
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