From Fortune Magazine:

Federal Reserve Chair Jerome Powell warned of hard times ahead after the Fed began jacking up interest rates in the spring of 2022 to attack high inflation. Economists predicted that the much higher borrowing costs would cause a recession, yet the recession never arrived, and none appears to be on the horizon. Employers added 160,000 jobs last month, and are expected to add 2.7 million jobs in 2023 with the unemployment rate remaining below 4% for the 23rd straight month.

The U.S. gross domestic product grew at a vigorous 4.9% annual pace from July through September with strong consumer spending and business investment driving the expansion. Prices are still 17% higher than they were before the inflation surge began in the spring of 2021. Despite inflation falling for a year, many Americans are dissatisfied with the economy. However, average hourly pay has outpaced inflation over the past year.

The Federal Reserve has raised its benchmark interest rate 11 times, and the Consumer prices were up 3.1% in November from a year earlier, down from a four-decade high of 9.1% in June 2022. Despite the resilience of the economy, the job market has cooled as inflation has subsided, though nowhere near enough to indicate a recession is on the way. Lower demand for workers tends to ease the pressure on employers to raise pay to keep or attract workers.

Employers are posting fewer job openings but not laying off many workers and the number of Americans who apply each week for unemployment benefits has remained unusually and consistently low. The labor market appears to be decelerating in a relatively painless way and the main industries accounting for 91% of added jobs in November were healthcare, government, and hotels and restaurants.



Read more: Jobs report December: Trend toward slower, but still healthy, hiring likely continued