January’s unemployment numbers held steady at 3.7%. Employers added a seasonally adjusted 353K jobs last month.
Meanwhile, back in reality, large companies are continuing to announce massive layoffs. This includes but isn’t limited to…
Cisco – 5% of its workforce
Docusign – 6% of its workforce
Expedia – 9% of its workforce
Nike – 2% of its workforce
Paramount – 3% of its workforce
Warner Music – 10% of its workforce
Zoom – 2% of its workforce
And that doesn’t include the layoffs at Google. Amazon, Ebay, Microsoft, and many others.
So what’s going on? Are things good or bad? Are we going to have a soft landing or will the economy recess? If the economy does recess, how bad will it be?
Is it time for us to gird our loins for battle, or should we just mix a Martini? No one seems to know.
Let me leave you with this…
I have several major Chicago money managers that are close friends. When I ask them, I get all sorts of talk, but no straight answers.
Former President Nixon was famously quoted as saying that what he needed was a one-handed economist. Because economists always say things like well one the one hand this will happen, but on the other if something else happens, then the opposite could occur.
Currently, most economists seem to think that there’s a 50/50 chance between a soft landing and a recession. Further, they say that if there is a recession, it will probably be mild.
So much of this depends on where you look and what economic data you survey. An example would be if you look at the unemployment numbers, we’ll have a soft landing. On the other hand, if you look at the layoffs, we’ll probably recess.
Again, no one knows. At least the economic news has radically improved. Twelve short months ago, two-thirds of economists predicted a recession, and most of them expected more than a 20% stock market correction.
What does all of this mean to those of us managing businesses?
We obviously aren’t out of the woods yet. As much as it pains me to say it, until we can see clear signs of not going into a recession, caution must still be the order of the day.
I wouldn’t be in a hurry to begin any new major projects at this point. We wouldn’t want to get into the middle of something and get caught with our pants down.
No one really knows what will happen with any degree of certainty. And when you add the November elections into the mix, all bets are off.
Be cautious, Be careful. Live to fight another day.
We’re all going to get through this. Let’s get through it together.
As an inducement, we’re offering 33% off your first six months of bookkeeping and / or the first three months of electronic payroll services on a complimentary basis. In order to claim this benefit, please click on the appropriate button below and provide your contact information. We’d love to help.
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. Whether you need Payroll Services, or Accounting and Tax Work, you have but to ask. I’m here and I remain,
Sincerely yours,
Chris Amundson
President
Accounting Solutions Ltd.
773-267-7500
888-310-0300
www.SalarySolutions.net
www.AccountingSolutionsLtd.com
Note that the only professional services provided by Accounting Solutions Ltd. are those specified in a written communication from our office detailing the scope of services to be rendered and the terms and conditions applicable to the engagement.