We raised the odds of a recession on March 4 from 20% to 35%. Today's Challenger Report showed an alarming jump in February's announced job layoffs to 172,017, the highest since July 2020 (chart). On the other hand, initial unemployment claims remained low through the February 28 week. So we aren't raising our odds of a recession again, for now.
A third of February's layoffs were announced by the government sector. That's not surprising given the activities of the DOGE Boys (chart). Announced layoffs in the private sector totaled 109,777 with retailing accounting for 35% of those layoffs.
Stock prices sold off again today on the layoffs news. We are still expecting a solid February employment report tomorrow reflecting a rebound in payrolls and in the average workweek following the coldest January since 1988 and the severe fires in Los Angeles during that month.
