Overview
- Federal Reserve minutes highlight a widening split between solid GDP and productivity and weak job creation, complicating policy decisions.
- Labor Department data show job losses in June and August and an average of roughly 62,000 monthly gains through September, when hiring surprised to the upside but unemployment reached 4.4%.
- Heavy investment in information-processing gear and AI, roughly 4.4% of GDP in Q2 per Commerce Department data, is boosting output without broad-based hiring.
- Hiring remains concentrated in healthcare and restaurants and bars, while transportation, manufacturing and government payrolls have slipped and several sectors such as homebuilding show clear strain.
- The Fed has cut rates twice and projects more easing through 2026, yet officials such as Lorie Logan caution against another near-term cut, with assessment clouded by a shutdown-driven data gap and still-limited layoffs that leave the economy vulnerable to shocks.