...given that businesses are already fighting for profitability, hiking the minimum wage, given the subsequent “trickle up” effect, will lead to further increases in automation and the “off-shoring” of jobs to reduce rising employment costs.
The Amazonification of America is accelerating, in the process destroying the legacy brick and mortar sector, which peaked in Jan 2017, and has lost jobs for 7 consecutive months.
In our payrolls preview we warned that it was the seasonals that were a major negative risk, with August jobs missing consensus in 8 of the past 10 August prints. Well, make that 9 of the past 11.
With the US-China trade war getting thrust to the backburner, traders will now focus on tomorrow's payrolls report for an indication of any unexpected reversals in the Fed's widely priced in 25bps rate cut on Sept 18.
With minimal working age population growth, full employment, no further female labor force slack; there is little further potential for labor force growth or resultant economic growth...