A deteriorating labor market is poised to cause a rapid downturn in the US economy, according to Andrew Hollenhorst, Citigroup’s chief US economist. He anticipates an abrupt economic reckoning later this year.
“Firms are hiring at a lower rate. Firms are having workers work less hours,” Hollenhorst told CNBC on Tuesday. “So this gradual softening has already started. That tends to snowball and end up in something that looks more like a hard landing.”
Although recent labor market data doesn’t necessarily indicate such a grim scenario, Hollenhorst argued that some reports suggest a more pessimistic outlook than many might realize. A hard landing is particularly concerning, as it can lead to a full-blown recession.
“Small businesses are telling us that their hiring intentions are at the lowest levels that we’ve seen since 2016,” he said, citing…
