All articles tagged with #economic downturn
The article highlights a shift in the long-term unemployed demographic, now increasingly including college-educated individuals like Sean Wittmeyer, who despite advanced degrees and skills, face prolonged joblessness due to economic downturns affecting industries such as construction and technology.
Top economist Mark Zandi warns the US is on the brink of recession due to weakening labor markets, flat consumer spending, declining construction and manufacturing, and rising inflation, which will make it difficult for the Fed to stimulate growth.
The influencer industry faces economic challenges due to recession fears, leading to decreased brand spending and changing consumer behavior, but some creators adapt by diversifying content and platforms to survive and thrive amid uncertainty.
U.S. President Donald Trump announced 25% tariffs on imports from Japan and South Korea, intensifying economic challenges for these export-dependent nations already facing growth slowdowns and potential recessions. The tariffs target key exports like autos and steel, with Japan's economy expected to shrink slightly by 2026, while market reactions remain cautious, awaiting further negotiations.
Russia's economy is showing signs of decline due to reduced military spending, high inflation, and the impact of Western sanctions, which threaten its ability to sustain its war efforts in Ukraine. Despite initial resilience, indicators like manufacturing contraction and falling GDP highlight increasing economic strain, with potential further instability if sanctions intensify or oil prices drop.
Bosch, a major German automotive supplier, is reducing the workweek for 450 employees to four days due to economic challenges, including declining demand and competition from China. This move reflects broader struggles in Germany's economy, which is facing a second year of negative growth and a manufacturing recession. Bosch's decision follows similar actions by other European carmakers, like Volkswagen and Stellantis, as they grapple with cost-cutting measures and reduced demand.
A Kremlin-linked think tank warns that Russia is at risk of stagflation, where high inflation and economic stagnation occur simultaneously. Despite high interest rates aimed at curbing inflation, the Russian economy is facing a downturn, with businesses suffering from reduced profitability and potential bankruptcies. The central bank's tight monetary policy has not significantly lowered inflation, which remains high, particularly in food prices. The economy contracted by 3.1% year-over-year, and further interest rate hikes are expected as inflation persists.
Luxury homes in Hong Kong are being sold at significantly reduced prices as the property market faces a downturn. This trend reflects broader economic challenges and a shift in demand within the region's real estate sector.
China is grappling with a severe housing crisis, with nearly four million unsold apartments and an estimated 10 million unfinished homes. Despite a bold new plan by President Xi Jinping and his administration to have the government purchase these empty units, experts believe it is insufficient to address the broader economic challenges. The crisis, which began nearly four years ago, has led to widespread bankruptcies and threatens the stability of one of the world's largest economies.
China's government is refusing bailouts to struggling real estate developers, signaling a shift towards a "survival of the fittest" approach. The $5 trillion real estate sector has been hit hard by the government's decision to cut off debt financing, leading to bankruptcies and a significant economic downturn. The IMF has downgraded growth estimates for the Chinese economy due to unresolved financial distress among developers and weakened homebuyer confidence. Chinese Minister of Housing and Urban-Rural Development Ni Hong emphasized the need to address the challenges in the property sector and focused on initiatives for affordable housing and urban renewal projects during a parliamentary meeting.
Many in China, particularly young people, feel the economy is in recession despite official growth figures, with high unemployment, declining property values, and reduced job opportunities leading to a crisis of confidence. The traditional economic model of high investment and manufacturing has led to excessive debt and limited growth, while a shift towards service sector jobs has not materialized as expected. The property market downturn has also impacted consumer spending, and diplomatic tensions with the West are contributing to foreign investment concerns.
The European Central Bank's Chief Economist warned that inflation threats may prevent rate cuts this year, despite acknowledging the potential for an economic downturn. Geopolitical tensions, such as those in the Middle East, could disrupt energy markets and supply chains, impacting costs. Market expectations for rate cuts clash with the ECB's cautious approach, with concerns about the euro-area's economic slowdown and the potential for external factors to trigger a recession.
Several companies, including Etsy, State Street, Hasbro, Spotify, and Condé Nast, have announced mass layoffs during the holiday season. While some attribute these layoffs to a perceived economic downturn, the data suggests a mostly strong economy. The timing of these layoffs is often driven by the need to boost end-of-year profits and appease shareholders. However, the current focus on workers' rights and the negative impact on company morale and public image may lead employers to reconsider laying off workers during the holidays.
California is facing a record $68 billion budget deficit, largely due to misjudged tax collections and an economic slowdown exacerbated by storms and rising prices. The deficit poses challenges for Governor Gavin Newsom as he seeks to build his national profile. The state must now develop a plan to address the deficit, with Newsom set to present his proposal in January. Despite the deficit, the state still has over $37 billion in savings, and lawmakers may consider using some of those funds to help balance the budget. The economic downturn has hit California particularly hard, with rising unemployment and a decline in home sales.
CNBC's Jim Cramer warns that some investors are making irrational decisions and buying poorly-performing stocks, leading to a potential "nasty hangover" in the market. While Wall Street initially evaluated equities in a sensible manner, the market broadened out as the mini banking crisis receded, and investors became more speculative. Cramer highlights the example of Estee Lauder, whose stock rose despite business slowdown and competition. He predicts that investors may turn to other struggling stocks like Moderna and Pfizer next. Cramer advises caution and suggests having designated brokers to avoid regrets in the morning.