CNBC Television
Girard: The labor market may be weakening, but wage growth is slowing too
11/5/2025, 12:20:38 PM
Economic Summary
- Recent payroll estimates show a modest pickup in hiring, supported by ADP weekly data that averaged about 14,000 jobs added per week, implying roughly 50,000–60,000 monthly gains if sustained (ADP).
- Layoff announcements have clustered this year—Challenger data noted over 940,000 year-to-date job cuts as of early October—with firms including IBM, UPS, Amazon, and Target announcing reductions, raising concern about labor-market durability.
- AI-related uncertainty is prompting firms to be more cautious in hiring, as employers reassess future staffing needs and potentially delay or restructure roles.
- Inflation remains somewhat persistent with rising input and selling prices; however, slowing wage growth could alleviate inflationary pressure, which the Fed will monitor closely.
Bullish
- ADP weekly data suggests hiring has resumed, indicating a potential jobs rebound.
- State-level initial unemployment claims have not meaningfully risen yet.
- Slowing wage growth could ease inflationary pressure and reduce Fed tightening risk.
Bearish
- Rising layoff announcements from firms like IBM, UPS, Amazon, and Target indicate elevated job-cut activity.
- AI-driven uncertainty is causing firms to pause hiring and reassess workforce needs.
- Persistent inflation and rising input/selling prices could weigh on hiring and corporate margins.
Bullish tickers
ADP
Bearish tickers
IBMUPSAMZNTGT
IBM
Bullish
Restructuring and focus on AI/efficiency could improve margins over time, though not explicitly stated in the transcript.
Bearish
Announced cuts of a low single-digit percentage of workforce, contributing to the recent wave of layoffs and signaling cost-cutting amid uncertain demand and AI impacts.
UPS
Bullish
Operational resilience in core delivery business could moderate long-term impact despite cuts.
Bearish
Listed among companies announcing layoffs, reflecting weaker demand or restructuring pressures in logistics.
AMZN
Bullish
Large-scale diversification and scale may allow faster recovery and reallocation of resources.
Bearish
Included in recent layoff announcements, part of broader tech/retail job-cut trend tied to cost control and automation.
TGT
Bullish
Retail fundamentals or cost reductions could stabilize earnings after adjustments.
Bearish
Named as one of the firms announcing layoffs, indicating pressures in retail staffing and cost management.
ADP
Bullish
Weekly ADP figures suggest a reversal from September weakness, estimating ~14,000 jobs added weekly and signaling renewed hiring momentum.
Bearish
ADP data can be noisy and subject to revisions, so weekly estimates may overstate short-term momentum.
People mentioned
Steve LeismanGabrielle Von RougeAnnie PalmerMichelle