By Dominique Dwor-Frecaut 08-03-2021
In: hive-exclusives | Economics Growth & Labour Market

Goodbye K-Shaped Recovery, Hello V-Shaped

(3 min read)
Resize text:

Friday’s NFP likely mark the onset of a noninflationary, V-shaped recovery. At 379,000 against less than 200,000 expected, Friday’s bumper non-farm payrolls (NFP) number probably signals the start of economic normalization. The sectors that the pandemic has hit hardest, leisure and hospitality, accounted for most of the increase. The weak employment recovery in these sectors is largely responsible for what has been a K-shaped economic recovery until now.

Also, February hourly earnings were flat despite the bumper increase in NFP – another sign of normalization. Wages in leisure and hospitality tend to be lower than in other sectors. Consequently, the March-April spike in unemployment was accompanied by a spike in wage growth that reflected a compositional effect, i.e., a decrease in low-wage employment, rather than labour market tightness. The reversal of this compositional effect in February is another sign that labour market conditions are returning to normal.


£39/month thereafter

For access to our Slack Chat Room, where we discuss all things markets with our researchers and subscribers



ECB Preview: Biding Time Until June (2 min read)

By Caroline Grady | Apr 20, 2021
Stepped up PEPP purchases since the 11 March ECB meeting leave little need for any policy changes at this week’s governing council meeting...

Russia Sanctions: The Shock That Never Came (5 min read)

By Tatiana Orlova | Apr 16, 2021
The most important measure bars US entities from newly issued local sovereign debt, effective from 14 June. The ban includes debt issued by the CBR...

Weekly Vaccination Update: J&J Pause and EU Supply Schedule (1 min read)

By Sam van de Schootbrugge | Apr 14, 2021
In this prime tracker, we review the latest vaccine developments globally. This week, we’ve added some brief commentary...


ECB Preview: Biding Time Until June (2 min read)

By Caroline Grady | Apr 20, 2021
Summary Thursday’s ECB meeting is unlikely to…

Five Things You Did Not Know About China (2 min read)

By Bilal Hafeez | Apr 13, 2021
China is a global economic superpower, yet…

Want To Join Our Community Of Leading Investors And Researchers In Our Slack Chat Room?