The US labor market is showing signs of slowing down, but it’s not yet time to hit the panic button. The June jobs report from the Bureau of Labor Statistics indicates a rise in nonfarm payrolls by 190,000, while the unemployment rate remains steady at 4%. This is a decrease from May, where the economy added 272,000 jobs.

The key question for the rest of 2024 is whether this slowing job growth is a sign of normalization in the labor market or an early indicator of a broader economic slowdown. For now, economists lean towards the latter.

The stock market, however, has been trading at record highs this week, despite softer-than-expected economic data. This includes inflation readings that have the US pacing back towards a “disinflationary path,” according to Federal Reserve Chair Jerome Powell.

Investors are pricing in two interest rate cuts this year, with the first most likely to come in September. This is based on the nearly 75% chance the Fed cuts rates in September, as suggested by the CME FedWatch Tool.

The labor market data released this week shows more signs of a slowdown. The ADP Research Institute’s National Employment Report showed 150,000 jobs were added to the private sector in June, a deceleration from the 157,000 job additions in May.

Despite these signs, the labor market is still showing some resilience. The Bureau of Labor Statistics reported 8.14 million jobs open at the end of May, an increase from the 7.92 million job openings in April.

In conclusion, the US labor market is cooling, but it’s not yet cool. The slowing growth is a concern, but there are still signs of resilience. The key is to keep a close eye on the data and trends in the coming months.