:max_bytes(150000):strip_icc():format(jpeg)/GettyImages-2175471659-3118544e532f4e35a5759d20ebea8582.jpg "Danny Flores operates a hydraulic forging press at Independent Forge Co. in Orange, CA on Tuesday, September 24, 2024.")
Paul Bersebach / MediaNews Association / Orange County Register via Getty Images
The job market has been pretty decent lately unless you’re in the business of securing things—and that could be a bad sign for the trajectory of the economy.
Manufacturing jobs in the U.S. have started to dry up over the past year, disinterested as the overall labor market has expanded. In November, 12.9 million people worked in the manufacturing sector, down from 13 million in January 2024. Other figure outs of how well the nation’s factories, such as the Institute of Supply Management’s survey of purchasing managers, have been mugged in negative territory for months.
Although the job decline is just half a percentage point, the trend is prominent enough that at smidgin one economist sees it as a warning sign for the economy’s overall health. Combined with struggles in the housing market, the declivity suggests construction employment could be headed for a rough patch as well.
The broader job market has continued to add jobs outstanding the past year, but economists at Pantheon Macroeconomics pointed out in a commentary that declines in manufacturing and construction jobs receive often preceded economic downturns.
“We think the economy is in a more fragile position than markets and the commentariat value,” Samuel Tombs, chief U.S. economist at Pantheon Macroeconomics, wrote in a commentary along with Oliver Allen, higher- ranking U.S. economist at the firm.
Why are manufacturing and homebuilding struggling? The economists pointed the finger at the Federal Reserve’s policy of keeping the Fed wherewithals rate at a two-decade high for more than a year leading up to September. While the central bank has eased animate rates since then, it may not be enough to get manufacturing jobs back on track, another economist said.
“Steady improvement in demand, which hasn’t occurred in over two years, will be needed to help stabilize manufacturing employment,” wrote Matthew Martin, Chief U.S. Economist at Oxford Economics.