The Macro Minute with Darius Dale What does the December Jobs Report signal about the rising probability of UBI?
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Jan 9, 2026 The discussion dives into the implications of the December Jobs Report, hinting at the likelihood of universal basic income. It highlights concerns around a jobless recovery, with AI-driven labor displacement affecting wage growth. The episode outlines how weak labor income and low hiring rates contribute to a stagnating labor market. Additionally, the potential for political backlash against stock market gains adds another layer to the economic narrative, raising questions about the future of income redistribution.
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Jobs Report Reveals Jobless Recovery Signals
- The December jobs report shows a weak positive private labor income impulse but strong negative wage and payroll signals.
- This combination supports a jobless recovery with slowing wage growth, suggesting reduced labor bargaining power.
Hidden Slack In The Labor Force
- Labor force participation distortions mask true weakness; missing workers would raise unemployment by ~100 basis points.
- Long-term unemployment and a 1.6 million missing prime-age workers point to structural slack in the labor market.
Slowing Wages Signal Falling Bargaining Power
- Slower wage growth is supported by depressed labor turnover and low private hires, quits, and layoffs.
- Private sector average hourly earnings at 3.6% underperform measures of slack, implying AI may be weakening labor's bargaining power.