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Illustration: Lazaro Gamio/Axios

The U.S. jobs market, having long been the bedrock of the nation's economic expansion, is starting to worry economists ahead of next week's payroll data.

What's happening: After years of remarkably smooth sailing, 2019 has brought market volatility and some concern about whether the economy can keep adding jobs at a fast enough pace to sustain the expansion.

What we're hearing: Job gains don't necessarily have to turn negative to signal trouble, Mark Zandi, chief economist at Moody's Analytics, told Axios at a labor market conference hosted by payroll processor ADP this week.

All that's required is a strong slowdown in job growth. A 0.5% increase from a cyclical low on the unemployment rate has accurately predicted every recession in recent history and has never been a false positive, as Brookings economist Claudia Sahm noted recently.

  • "Once unemployment starts to rise, even from a very low level, it undermines confidence, and the only difference between an expanding economy and a recessionary one is faith," Zandi said.
  • "A recession is a collective loss of faith, and people lose faith when they start seeing unemployment rise."

Why now? A slowdown is not that unlikely, given the state of the labor market. The unemployment rate is at a 50-year low — it was 3.6% in May — and employers are reporting more trouble finding people to hire.

  • In a poll of small business owners conducted in May, 25% said that finding qualified workers was their No. 1 problem, according to the National Federation of Independent Business.
  • The trade war also is adding stress to the economy, but so far the effects have been concentrated in the trade and export sectors, which make up a small piece of overall employment.

What to watch: The all-important services side of the economy has been strong, but is beginning to feel the impact of the tight labor market, said Ahu Yildirmaz, co-head of ADP Research Institute. The number of job openings exceeded the number of unemployed Americans by the largest margin on record in April.

  • "Let's remember you need approximately 100,000 net new jobs to keep the economy moving. We're still above that level, however there are so many other factors," she said.
  • "If you look at the last couple months, the jobs numbers were really, really volatile."

The bottom line: Another blowout print like January's, which showed 312,000 jobs added, will calm a lot of jitters.

Go deeper

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The Senate voted 93-2 on Friday to confirm retired Gen. Lloyd Austin as secretary of defense. Sens. Mike Lee (R-Utah) and Josh Hawley (R-Mo.) were the sole "no" votes.

Why it matters: Austin is the first Black American to lead the Pentagon and President Biden's second Cabinet nominee to be confirmed.

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Senate Majority Leader Chuck Schumer (D-N.Y.) announced that the House will deliver the article of impeachment against former President Trump for "incitement of insurrection" on Monday.

Why it matters: The Senate is required to begin the impeachment trial at 1pm the day after the article is transmitted.

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In normal times, private equity would be nervous about Democratic Party control of both the White House and Congress. But in pandemic-consumed 2021, the industry seems sanguine.

Driving the news: Industry executives and lobbyists paid very close attention to Treasury Secretary nominee Janet Yellen's confirmation hearings this week, and came away convinced that tax reform isn't on the near-term agenda.