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CONTRIBUTORS

Anujeet Sareen, CFA

Portfolio Manager
United States

Big Picture—Labor Growth Sluggish: Companies are raking in profits, but job growth remains sluggish. Private-sector employment is roughly 5% below its pre-pandemic trend.

Despite recent high-profile layoff announcements, private-sector job growth is back in positive territory.

Small business earnings have been accelerating, which typically leads to an increase in hiring.

Stronger earnings among small businesses (as shown in the previous chart) are a key reason hiring intentions have risen for the fourth consecutive month. Nearly 45% of all jobs are at companies with fewer than 50 employees, underscoring why this uptick in hiring intentions is meaningful.

Deregulation Tailwinds: There has been a lot of attention on economic tailwinds from tax cuts and the Federal Reserve’s easing cycle, but deregulation, particularly for small businesses, is another potential tailwind.

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WF: 8857811

IMPORTANT LEGAL INFORMATION

This material is intended to be of general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any security or to adopt any investment strategy. All investments involve risks, including possible loss of principal. There is no guarantee that a strategy will meet its objective. Performance may also be affected by currency fluctuations. Reduced liquidity may have a negative impact on the price of the assets. Currency fluctuations may affect the value of overseas investments. Where a strategy invests in emerging markets, the risks can be greater than in developed markets. Where a strategy invests in derivative instruments, this entails specific risks that may increase the risk profile of the strategy. Where a strategy invests in a specific sector or geographical area, the returns may be more volatile than a more diversified strategy.

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