Institutions: The U.S. labor market remains fragile, with a 40% chance of falling into a recession.

SmartContractAuditor · 2026-04-03T15:26:44+00:00

EY-Parthenon Senior Economist Lydia Boussour noted that although the United States’ employment data in March was strong, the labor market remains fragile, with companies’ hiring intentions falling. She expects selective hiring and constrained wage growth in the coming years, and the unemployment rate could rise to 4.7%. The risk of a recession still remains.

SmartContractAuditor

2026-04-03 15:26:44

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Odaily Planet Daily reports: EY-Parthenon senior economist Lydia Boussour said that despite a strong rebound in U.S. March employment data, the labor market remains fragile. She believes that amid a policy environment filled with uncertainty, businesses are becoming more cautious, hiring intentions are cooling, and companies are increasingly inclined to protect profit margins and respond by boosting productivity rather than expanding headcount. “Looking ahead, we expect the labor market in 2026 to be largely in a freeze, characterized by selective hiring, constrained wage growth, and strategic workforce adjustments while labor supply remains in historically tight conditions.” Boussour expects employment growth to be slightly below the break-even level, and the unemployment rate to gradually rise to around 4.7%. “Given that the conflict in the Middle East is still ongoing, downside risks dominate, and the probability of an economic downturn is 40%,” she added. (Jin10)

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