The US avoided a recession in 2023. What’s the outlook for 2024?

Economists told States Newsroom that they don’t expect consumers to change their spending habits enough to hurt the economy in 2024. Photo by Justin Sullivan/Getty Images. This year could bring potential shifts in the economy, but many economists and investment analysts expect that the country will likely avoid a recession in 2024 even as growth slows in the first half of the year. States Newsroom talked to economists about their expectations for some key metrics as well as their concerns about what could change their outlook. The job market will remain strong but not as hot as 2023 The unemployment rate has remained below 4% for nearly two years, with the unemployment rate falling to 3.7% in November. But hiring has cooled off from the start of the year and retail employment dropped by nearly 40,000 jobs in the most recent jobs report, which leaves the question: How stable will the labor market be in 2024? Mike Konczal, director of macroeconomic analysis at the Roosevelt Institute, a New York-based think tank, said that although there has been a slowdown in the hiring rate, there have not been many layoffs, which bodes well for next year if the Federal Reserve does not “overshoot” in its efforts to slow the economy. The Fed has paused its campaign of raising interest rates, which it began in March 2022. “Imagine the unemployed as a pool of water. Instead of more unemployed people going in, it’s just draining a little less. That’s a different kind of dynamic,” he said. “We normally are used to, in a slow labor market, hires essentially just stop and layoffs increase. Some people pointed out that a lot of the change in employment has happened among younger people. It’s not been a broad-based slowdown in 25 to 54 year-olds.” […]

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By Donato