Potential Layoffs Ahead as Companies Brace for Interest RateHikes mathisworks/Getty Images The economy could be primed for a surge in layoffs by the end of 2024, economic experts say. That’s because aggressive Fed rate hikes haven’t been fully felt across the economy. Unemployment could rise to around 5% by year-end, according to economist David Rosenberg. A wave of layoffs could be coming as companies deal with the reality of higher interest rates, economists say. While the job market still looks strong on paper, hiring conditions are set for a slowdown later this year, according to David Rosenberg, economist and the founder of Rosenberg Research. That’s because the economy — and what’s been touted as a surprisingly strong job market — are actually weaker than they appear, he told Business Insider, predicting that unemployment could jump to 5% by the end of the year. Steve Briggs, the CEO of Briggs Financial, is also calling for dismal job losses to begin next year. In the worst-case scenario, unemployment could soar up to 10%-15% in 2025 and into 2026, Briggs predicted, though that view is very much an outlier among other Wall Street forecasters, and would be generally unprecedented outside of a major recession. The peak unemployment rate during the Great Recession was 10% in 2009. Behind the dire predictions for the US labor market is the Fed’s aggressive monetary policy tightening to control inflation, Briggs said, referring to the current economic environment as the “tip of the iceberg.” “Right now it’s still pretty unpredictable,” Briggs said in an interview. “But boy, there’s more than enough smoke here to warrant making sure we are in a very defensive position.” Signs of weakness have been flashing in several under-the-radar indicators. While the economy added 275,000 jobs in February, which was more than expected, continuing unemployment claims have ticked higher for most of the last year, suggesting that it’s becoming harder for out-of-work Americans to land a new gig. Following revisions to the prior two months’ figures, the unemployment rate also rose to 3.9% in February, its highest level in two years. Most of the jobs being created in the economy are also part-time gigs, Rosenberg said, which explains why the number of full-time workers declined in February compared to last year, and why the average weekly hours among employees has dropped to just around 34 hours, according to the Bureau of Labor Statistics. That’s a level that typically puts pressure on employers to start cutting their staff, Rosenberg added. « Previous Article Next Article » Share This Article Choose Your Platform: Facebook Twitter Google Plus Linkedin Related Posts The Risks of Gold and Silver ETF's vs. Physical Metals READ MORE US inflation increases moderately; consumer spending boosts Q2 outlook READ MORE World Gold Council: Gold Demand Trends Full Year 2023 READ MORE Weaker supply will drive platinum deficit higher than expected in 2024, WPIC says READ MORE Add a Comment Cancel replyYour email address will not be published. Required fields are marked *Name * Email * Save my name, email, and website in this browser for the next time I comment. Comment