Summary:
- The U.S. job market is cooling, with employers pulling back on hiring, but economists believe it's necessary for the economy.
- The latest jobs report shows 187,000 jobs added in July, and the unemployment rate dropped to 3.5%, benefiting various industries.
- The slowdown in the job market is seen as a positive factor for curbing inflation, and some experts believe the Fed's job is done in terms of raising rates.
- Fitch's decision to downgrade the U.S. credit rating has sparked volatility on Wall Street, raising concerns about its implications.
A rocky week of ups and downs for the U.S. economy includes the downgrade of the nation's credit rating and a new jobs report. CNN's Jen Sullivan breaks down the numbers and what it all means for the country moving forward.
Employers Pulling Back on Hiring
Employers appear to be pulling back on hiring, and while that may sound discouraging, some economists say this is exactly what the economy needs right now. Businesses aren't laying off workers.New Jobs Report and Unemployment Rate
The Bureau of Labor Statistics announced Friday that 187,000 jobs were added in July, and the unemployment rate dropped to 3.5%. Industries seeing the largest job gains were health care, social assistance, financial activities, and wholesale trade. The increase in job opportunities has given working people more choices. However, there has been a steady decline in hiring over the last year.Slow Down Benefiting Inflation
The slowdown in the job market is actually a good thing for inflation. Federal Chair Jerome Powell has repeatedly emphasized that to curb inflation, the number of job openings needs to better align with the number of people looking for a job, and that's exactly what's happening now. Some experts believe the Fed's job is done and that they don't need to raise rates further at this point.Fitch Downgrades U.S. Credit Rating
The news comes on the heels of Fitch rating downgrading the U.S. credit rating earlier this week. Some officials strongly disagree with Fitch's decision and find it entirely unwarranted. This announcement has caused a volatile week on Wall Street, with all three major indices closing out the week with declines.Conclusion
Despite the cooling job market, there are varying opinions on its impact on the overall economy. While some experts view it as necessary for curbing inflation, others worry about the potential implications of the credit rating downgrade. As the situation unfolds, the country will have to navigate these economic challenges.I'm Jen Sullivan reporting.
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