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For Your Money is brought to you by NelsonCorp Wealth Management.
Brandy Auterson-Hurst:
It’s now time for For Your Money. We’re joined by James Nelson, financial advisor at NelsonCorp Wealth Management. Welcome back, James.
James Nelson:
Thanks, Brandy.
Brandy Auterson-Hurst:
So we’ve seen weaker economic numbers recently. Is there anything that you think warrants particular attention?
James Nelson:
Yeah, while we’ve seen some slowing in growth in recent months, it’s still kind of a mixed bag. The labor market continues to remain stronger than most would expect. That’s good news for the consumers spending, but it will keep the Federal Reserve probably in the game a little bit longer than expected. Maybe two more rate hikes yet this year.
The other thing that stands out to us is the US productivity, and that’s the chart that we have here today. And this chart shows the blue line here is the year-over-year growth of the US labor productivity going back to the 1940s. This shows that the business output of companies per hour worked. This has been on the decline for decades, but has been accelerating here in the last several years, and you can see that all the way over on the right-hand side. That’s the worst on record. So certainly something concerning or should be concerning for all of us.
Brandy Auterson-Hurst:
Okay. So what do you think the biggest implication of this is?
James Nelson:
Yeah, so over the last several decades, you could probably argue there’s several reasons for productivity kind of tapering off. In recent years, you could pretty much point the finger probably to technology has done this, and also maybe some of the work at home arrangements have weakened productivity a little bit. Going forward, we hear a lot about AI. AI is the big thing that business is looking at to try to turn that tide around and increase productivity going forward.
Brandy Auterson-Hurst:
For sure. All right, James, as always, thanks for joining us.
James Nelson:
Thank you, Brandy.