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The upcoming holiday season may pose challenges for job seekers looking for seasonal employment, as several indicators suggest that the strong job market may be slowing down. This trend is essential as it serves as a yearly assessment for companies, particularly retailers, who closely monitor consumer behavior to gauge the overall state of the economy.
Retailers based in the United States have expressed intentions to maintain or reduce the number of seasonal hires due to concerns about increased labor expenses and potential decreases in consumer spending linked to inflation, rising interest rates, and diminishing savings. The ongoing softening of the U.S. job market, following the pandemic-induced hiring spree and signing bonuses for workers over the last few years, is also evident.
At present, U.S. retailers have announced plans to add approximately 573,000 seasonal positions, marking the lowest figure since 2013 according to an analysis by Challenger, Gray & Christmas Inc., a global outplacement firm. Despite this, job seekers' searches for seasonal work have increased by 33% compared to last year, while employer demand for seasonal workers has dropped by 8.2%, as reported by Indeed.
Notably, major companies such as Macy's and Dick's Sporting Goods have revealed a decrease in their holiday hiring numbers compared to previous years. However, Amazon stands out with plans to hire 250,000 seasonal workers this year, a significant increase from the 100,000 hired in the previous year, and is even offering $3,000 signing bonuses in some regions. In addition to employment levels, retailers' outlooks are being influenced by the impact of shoplifting on their financial performance.
Overall, the dynamics of the holiday hiring season appear to be shifting, with various factors influencing companies' decisions, including Amazon's substantial increase in seasonal hires and concerns regarding shoplifting.
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A recession in the euro area is looking increasingly likely as the economic downturn persists in the final quarter of the year, private-sector activity surveys showed.
Meantime, the outlook for global trade got a boost this week as South Korea’s exports are likely to maintain momentum. Elsewhere in Asia, Chinese banks maintained their benchmark rates as they aimed to boost liquidity and support lending.
Here are some of the charts that appeared on Bloomberg this week on the latest developments in the global economy:
Europe
S&P Global’s purchasing managers’ index was in contraction again in November, hitting 47.1. While that’s a bigger uptick than anticipated by economists, it marks the sixth consecutive month below the 50 level that marks expansion. Readings for both manufacturing and services showed a similar trend.
Germany’s Special Funds Exceed Regular Annual Budget*
Sources: German Finance Ministry, Federal Audit Court
* Off-budget funds are multiyear
Germany will suspend a constitutional limit on net new borrowing for a fourth consecutive year after Chancellor Olaf Scholz’s government was forced into a radical budget overhaul by a ruling last week from the nation’s top court. The emergency move to lift the so-called “debt brake” will be part of a revised 2023 budget that Finance Minister Christian Lindner plans to present next week.
Asia
Chinese Authorities Urge Stable Credit Expansion
Banks told to coordinate credit expansion from now until early 2024
Source: People's Bank of China
China may be done with rate cuts for now as policymakers turn to other means to support the economy and stabilize credit growth heading into the new year.
Semiconductor Recovery Continues
South Korea's chip exports emerge from a deep slump
Source: Trade Ministry
South Korea’s early trade data show exports are likely to maintain their growth momentum this month, continuing their rebound from a year-long slump and helping brighten the outlook for global commerce. Korea is a key global exporter, so its exports serve as a useful indicator of the health of the global economy.
Emerging Markets
Thai Economic Growth Lags Behind Regional Peers
Source: Bloomberg
Note: 2023 and 2024 are from Bloomberg's survey of economists
Thailand’s economic growth unexpectedly slowed in the third quarter as manufacturing slumped on weak exports, supporting the case for the new government to proceed with its planned $14 billion cash handout program.
Chile’s economy expanded more than forecast in the third quarter led by the mining sector, as the central bank started easing monetary policy. Gross domestic product rose 0.6% in the July-September period from a year earlier.
Marathon Month for African Central Banks' Rate Decisions
At least 17 will pronounce on rates with most anticipated to hold
Source: Bloomberg reporting
In what will be a marathon month for interest-rate decisions in Africa, its biggest economies are set to keep interest rates higher for longer. Angola and Zambia hiked this week to temper stubborn inflation and stabilize the local currency, and Nigeria is expected to hike as well. South Africa maintained its current rate, and others including Morocco, Kenya, and Ghana are seen doing the same.
US
Average 401(k) Retirement Account Balance
The average 401(k) balance is up by just $1,200 in the past 5 years
Source: Fidelity
Americans are increasingly tapping their retirement savings to cover housing and medical bills amid higher cost-of-living pressures, according to data from Fidelity Investments. Some 2.3% of workers took a hardship withdrawal last quarter, up from 1.8% a year earlier.
US mortgage rates dropped sharply, capping the biggest four-week slide in nearly a year and spurring a fresh round of applications to purchase homes.
World
Global Central Banks' Use of PBOC Swap Lines Keeps Climbing
Foreign countries increasingly tapped currency swap to get yuan
Source: People's Bank of China
China and Saudi Arabia have signed a local-currency swap agreement worth around $7 billion, deepening their ties as countries across the Middle East look to shift more of their non-oil trade away from the dollar.
Global Mortgage Rates Soar
The cost of home loans has more than doubled in many places
Source: Bloomberg
NOTE: Current rates are the latest available, as of these months: June (China, Australia); August (Hong Kong); September (South Korea); October (UK, New Zealand); November (Canada, US)
The shock that rippled through global housing markets as central banks rapidly raised interest rates last year has given way to a cold new reality: The real estate bonanza that fueled wealth for millions of people is over.
Central Banks Are Diverging on Rates
Change in borrowing costs since the start of 2023
Source: Bloomberg
Note: Mapped data show a change in interest rates for distinct central banks.
Hungary’s central bank cut its main interest in line with guidance, resisting government pressure for a bolder move in lowering the European Union’s highest borrowing costs. Sri Lanka and Paraguay also cut. Turkey’s central bank hiked interest rates by double the amount markets expected, while Sweden and Indonesia left rates unchanged.