SemiAnalysis: AI is Transforming US Jobs Outlook, Fed May Still Hold Pat

BlockBeats News, July 8th. Semiconductor and AI independent research firm SemiAnalysis published an article stating that the current US consumer confidence continues to weaken, but there are no clear signs of a corresponding deterioration in the labor market. The quit rate is usually the best indicator of consumer confidence in employment, and currently, the number of voluntary quits remains low, indicating that employees are not widely choosing to leave their jobs. However, consumers have begun to show concerns about future job prospects, and this sentiment is not driven by short-term factors such as oil prices. In contrast, the Consumer Confidence Index of the US World Large Business Federation shows a highly consistent trend with the quit rate, while the University of Michigan Consumer Confidence Index appears more pessimistic and less relevant.

Looking at industry data, in the past six months, job vacancies in the US industrial, manufacturing, and import-related industries have all increased, with a significant decline in job vacancies currently mainly concentrated in the information services industry. Artificial Intelligence (AI) has been the first to impact industries with low entry barriers. Market concerns about AI replacing jobs have far exceeded the actual impact, and this panic itself may further suppress wage growth and consumer spending, shifting the momentum of US economic growth from consumption to investment, even though a large-scale wave of unemployment caused by AI has not yet emerged.

Regarding US non-farm employment data, a low quit rate and weak consumer confidence are not positive signals. However, against the backdrop of an aging population, the continuous retirement of the baby boomer generation, coupled with immigrants no longer significantly driving labor force growth, the number of new jobs needed to maintain the unemployment rate at 4.3% is only about 55,000. Following last month's unexpectedly high addition of 172,000 jobs, a decline in employment data this month would still be within the baseline scenario. However, even though the market generally expects an addition of about 110,000 jobs, this level may still put downward pressure on the unemployment rate, thereby keeping the Federal Reserve in a wait-and-see position and not rushing to adjust monetary policy due to deteriorating consumer sentiment.