Layoffs Are in the Works at Half of Companies, PwC Survey Shows
Comment of the Day

August 18 2022

Commentary by Eoin Treacy

Layoffs Are in the Works at Half of Companies, PwC Survey Shows

This article from Bloomberg may be of interest to subscribers. Here is a section: 

That’s a key finding from a survey released Thursday by consultant PwC, which last month polled more than 700 US executives and board members across a range of industries. Half of respondents said they’re reducing headcount or plan to, and 52% have implemented hiring freezes. More than four in ten are rescinding job offers, and a similar amount are reducing or eliminating the sign-on bonuses that had become common to attract talent in a tight job market. 

At the same time, though, about two-thirds of firms are boosting pay or expanding mental-health benefits. The most common move: making remote work permanent for more people.

Eoin Treacy's view

The primary argument being used to say a recession has not already begun is the Purchasing Manager’s Index and the low unemployment rate. It is reasonable to say a recession is not underway if companies are buying more on a month over month basis and unemployment is close to a record low. 

It is still true that you cannot have a recession without people losing their jobs. This is perhaps the most pivotal data point for the trajectory of interest rates and the Dollar. The greenback continues to trend higher and not least because of the downward pressure on the euro. 

The strength of the dollar remains an impediment to a more convincing recovery by gold. 

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