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Weak jobs report feeds recession fears, stock market falls again

By Masao Suzuki |
December 8, 2018
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San José, CA - On Friday, December 7, the Department of Labor released its report on the job market in November. There was a net gain of 155,000 jobs, less than the predicted 200,000 and less than the average gains for the first ten months of the year. While the official unemployment rate stayed the same at 3.7%, the broadest measure of unemployment, which includes part-time workers who can’t find full-time work, ticked up to 7.6%, more than twice the official rate.

The weakness in the job market followed other economic reports that showed signs of a weaker economy. In particular, housing construction and business spending on buildings and equipment have weakened of late. These are the two sectors that lead the economy into a recession. Even before the stock market tumble of the last month, two-thirds of economists predicted a recession by the end of 2020.

The weak economy, combined with more tensions with China, pounded the stock market again. A broad measure of stock prices, the S&P 500, which includes 500 of the largest U.S. corporations, fell another 2.3%, and is now down for the entire year. Other indices, such as the popular Dow Jones Industrial Average and the technology-heavy NASDAQ also fell.