Workers Are Losing Power in the Job Market. That’s Good News for the Fed
- Labor leverage ratio retraces much of post-pandemic rise
- Powell says Fed needs to see further loosening of job market
The Federal Reserve is fretting about what they see as a too-hot jobs market.
Photographer: Jessica Pons/BloombergThis article is for subscribers only.
The balance of power in the jobs market is slowly tilting back toward employers as companies become choosier with their hires and workers turn more cautious about quitting.
A labor leverage ratio developed by ex-senior White House economist Aaron Sojourner that compares the level of quits to layoffs has retraced about two-thirds of the rise seen in 2021 and into 2022. The ratio surged when companies ramped up staffing after pandemic-driven lockdowns and workers were enjoying outsized pay offers for their services.