A top U.S. economist recently warned that the country's economy is on the "precipice" of a recession, Business Insider reported on Wednesday, citing Moody's economist Mark Zandi.
While the U.S. is not yet in a technical recession -- defined as two straight quarters of negative growth -- other areas like the labor market have been sounding a warning, according to the report.
Zandi, chief economist at Moody’s Analytics, said if employment falls for more than a month consecutively, the economy has entered a downturn.
Since May this year, employment has barely increased. "Given that the recent revisions to the jobs numbers have been consistently lower, much lower, it wouldn't be surprising if we learn with the coming revisions that employment is already declining," he said.
In July, more than 53 percent of industries reported job cuts, the economist cited recent data.
Zandi concluded that the U.S. economy is still not in a recession, as evidenced by the job decline factor. A recession is defined by a persistent decline in jobs, and the decline lasts for at least a few months, he said.
He also said that the economic tides could shift if policy weighs on growth. In his previous post, Zandi noted that U.S. President Donald Trump's policies, mainly tariffs and immigration, are the big drivers of his view that the economy is teetering at the edge of a downturn.
U.S. job growth slowed sharply in July, with only 73,000 nonfarm jobs added -- 31,000 fewer than economists had forecast, according to data released Friday by the Bureau of Labor Statistics (BLS).
The weaker-than-expected hiring pushed the unemployment rate up to 4.2 percent, from 4.1 percent in June, it said.
Job growth in May was revised down by 125,000 to a gain of just 19,000, while June's total was cut by 133,000, leaving only 14,000 jobs added.
US economy on precipice of recession: economist
