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Real-Time Payments Market to grow at a CAGR of 31.35% from 2022 to 2027: Increasing adoption of smartphones and access to high-speed internet to be a major driver to the market growth – Technavio
Real-Time Payments Market to grow at a CAGR of 31.35% from 2022 to 2027: Increasing adoption of smartphones and access to high-speed internet to be a major driver to the market growth – Technavio
PR Newswire
NEW YORK, March 10, 2023
NEW YORK, March…
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Real-Time Payments Market to grow at a CAGR of 31.35% from 2022 to 2027: Increasing adoption of smartphones and access to high-speed internet to be a major driver to the market growth - Technavio
PR Newswire
NEW YORK, March 10, 2023
NEW YORK, March 10, 2023 /PRNewswire/ -- The global real-time payments market size is estimated to increase by USD 55,539.13 million from 2022 to 2027. The market's growth momentum will progress at a CAGR of 31.35%. The increasing adoption of smartphones and access to high-speed internet is notably shaping the market growth. Smartphone usage has drastically increased in countries like Canada, China, and India in recent years. And the widespread 3G and 4G connectivity have enabled a simpler way of payments for customers. As the 5G network becomes popular in regions like North America, APAC, Europe, and the Middle East, the market is expected to grow during the forecast period.
For more insights on the historic market data (2017 to 2021), and forecast market size (2022 to 2027) - Request a sample report
Real-time payments market – Vendor Analysis
Vendor Landscape - The global real-time payments market is fragmented with the presence of several global as well as regional vendors. A few prominent vendors that offer real-time payments in the market are ACE Software Solutions Inc., ACI Worldwide Inc., Ant Technology Group Co. Ltd., Apple Inc., Cognizant Technology Solutions Corp., Fidelity National Information Services Inc., Finastra, Fiserv Inc., Icon Solutions Ltd., Mastercard Inc., Microsoft Corp., Mindgate Solutions Pvt. Ltd., Montran Corp., PayPal Holdings Inc., Ripple Labs Inc., Sila Inc., Tata Consultancy Services Ltd., Temenos Headquarters SA, Visa Inc., and Volante Technologies Inc. and others.
What's New? -
- Special coverage on the Russia-Ukraine war; global inflation; recovery analysis from COVID-19; supply chain disruptions, global trade tensions; and risk of recession
- Global competitiveness and key competitor positions
- Market presence across multiple geographical footprints - Strong/Active/Niche/Trivial - Buy the report!
Vendor Offerings -
- ACI Worldwide Inc. - The company offers real-time payment processing services which are used widely in business-to-business segments such as supplier payment and refund adjustment.
- Ant Technology Group Co. Ltd. - The company offers real-time payment services which are designed to do quick pay, barcode payment, smile to pay, and QR code payment solutions to meet transaction requirements in different commercial use.
- Apple Inc. - The company offers real-time payment services which provide easier, safer, and secure money transactions to various merchants.
- For details on the vendor and its offerings – Request a sample report
Real-Time Payments Market - Segmentation Assessment
Segment Overview
Technavio has segmented the market based on components (solutions and services), deployment (on-premises and cloud), and geography (APAC, North America, Europe, South America, and Middle East and Africa).
- The market share growth of the solutions segment is significant during the forecast period. These solutions process transactions between the customer/merchant and the bank/processors in real-time. This is a very safe and secure mode of payment. The cheaper cost of internet services has accelerated digital and technological adoption in several sectors. This has altered business models for various sectors including logistics, banking, education, retail, and healthcare among others. This has led to a drastic increase in digital payments across different sectors.
Geography Overview
By geography, the global real-time payments market is segmented into APAC, North America, Europe, South America, and Middle East and Africa. The report provides actionable insights and estimates the contribution of all regions to the growth of the global real-time payments market.
- APAC is estimated to contribute to 44% of the growth of the global real-time payments market during the forecast period. Mobile wallets like Apple Pay and Samsung Pay are growing in popularity in the region resulting in APAC being the fastest-growing region in the real-time payments market. Furthermore, the pandemic promoted real-time payment options including NFC and quick response (QR) codes. Major factors that accelerate the regional market growth include the convenience offered by real-time payments, such as quick service and check-out time at cafes, drive-throughs, and casual dining restaurants. Therefore, the regional market in APAC is expected to grow during the forecast period.
Insights on the market contribution of various segments including country and region wise, historic data (2017 to 2021), and forecast market size (2023 to 2027) - Download a Sample Report
Real-Time Payments Market – Market Dynamics
Key Trends -
- Rapid digitalization in the payments sector is a leading trend in the market. Digital currencies, biometrics, and real-time payments became popular and widely accepted in the post-pandemic society.
- This is done so as an effort to reduce the demand for cash. Dynamic real-time payment credit has also enabled retailers to scan customer codes, where fraud can be detected immediately.
- Consequentially, the global real-time payments industry witnesses growth due to the growing developments and efforts towards digitalized payments.
Major challenges -
- The rising issues of data breaches and security while conducting payments are a primary challenge impeding market growth.
- Consumers are reluctant to use real-time payment networks to carry out their transactions because they are worried that unauthorized mobile service providers may have access to their financial information.
- Moreover, as a result of increased use of public Wi-Fi, weak passwords, and phishing attacks, there is an anticipation of an increase in identity theft and data breaches in the coming years.
Insights on Market Drivers, trends, & Challenges, historic period (2017 to 2021) and forecast period (2023 to 2027) - Request a Sample Report!
What are the key data covered in this Real Time Payments Market report?
- CAGR of the market during the forecast period
- Detailed information on factors that will drive the growth of the real-time payments market between 2023 and 2027
- Precise estimation of the size of the real-time payments market size and its contribution to the market in focus on the parent market
- Accurate predictions about upcoming trends and changes in consumer behavior
- Growth of the real-time payments industry across APAC, North America, Europe, South America, and Middle East and Africa
- A thorough analysis of the market's competitive landscape and detailed information about vendors
- Comprehensive analysis of factors that will challenge the growth of vendors in the real-time payments market
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Real Time Payments Market Scope | |
Report Coverage | Details |
Base year | 2022 |
Historic period | 2017-2021 |
Forecast period | 2023-2027 |
Growth momentum & CAGR | Accelerate at a CAGR of 31.35% |
Market growth 2023-2027 | USD 55,539.13 million |
Market structure | Fragmented |
YoY growth 2022-2023 (%) | 29.0 |
Regional analysis | APAC, North America, Europe, South America, and Middle East and Africa |
Performing market contribution | APAC at 44% |
Key countries | US, Canada, Thailand, Singapore, and UK, Canada, Mexico, Italy,Spain, India, Japan, Australia, and South Korea |
Competitive landscape | Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled | ACE Software Solutions Inc., ACI Worldwide Inc., Ant Technology Group Co. Ltd., Apple Inc., Cognizant Technology Solutions Corp., Fidelity National Information Services Inc., Finastra, Fiserv Inc., Icon Solutions Ltd., Mastercard Inc., Microsoft Corp., Mindgate Solutions Pvt. Ltd., Montran Corp., PayPal Holdings Inc., Ripple Labs Inc., Sila Inc., Tata Consultancy Services Ltd., Temenos Headquarters SA, Visa Inc., and Volante Technologies Inc. |
Market dynamics | Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview | If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
Browse for Technavio Consumer Discretionary market reports
Table of Contents
1 Executive Summary
- 1.1 Market overview
- Exhibit 01: Executive Summary – Chart on Market Overview
- Exhibit 02: Executive Summary – Data Table on Market Overview
- Exhibit 03: Executive Summary – Chart on Global Market Characteristics
- Exhibit 04: Executive Summary – Chart on Market by Geography
- Exhibit 05: Executive Summary – Chart on Market Segmentation by Component
- Exhibit 06: Executive Summary – Chart on Market Segmentation by Deployment
- Exhibit 07: Executive Summary – Chart on Incremental Growth
- Exhibit 08: Executive Summary – Data Table on Incremental Growth
- Exhibit 09: Executive Summary – Chart on Vendor Market Positioning
2 Market Landscape
- 2.1 Market ecosystem
- Exhibit 10: Parent market
- Exhibit 11: Market Characteristics
3 Market Sizing
- 3.1 Market definition
- Exhibit 12: Offerings of vendors included in the market definition
- 3.2 Market segment analysis
- Exhibit 13: Market segments
- 3.3 Market size 2022
- 3.4 Market outlook: Forecast for 2022-2027
- Exhibit 14: Chart on Global - Market size and forecast 2022-2027 ($ million)
- Exhibit 15: Data Table on Global - Market size and forecast 2022-2027 ($ million)
- Exhibit 16: Chart on Global Market: Year-over-year growth 2022-2027 (%)
- Exhibit 17: Data Table on Global Market: Year-over-year growth 2022-2027 (%)
4 Historic Market Size
- 4.1 Global real time payments market 2017 - 2021
- Exhibit 18: Historic Market Size – Data Table on Global real time payments market 2017 - 2021 ($ million)
- 4.2 Component Segment Analysis 2017 - 2021
- Exhibit 19: Historic Market Size – Component Segment 2017 - 2021 ($ million)
- 4.3 Deployment Segment Analysis 2017 - 2021
- Exhibit 20: Historic Market Size – Deployment Segment 2017 - 2021 ($ million)
- 4.4 Geography Segment Analysis 2017 - 2021
- Exhibit 21: Historic Market Size – Geography Segment 2017 - 2021 ($ million)
- 4.5 Country Segment Analysis 2017 - 2021
- Exhibit 22: Historic Market Size – Country Segment 2017 - 2021 ($ million)
5 Five Forces Analysis
- 5.1 Five forces summary
- Exhibit 23: Five forces analysis - Comparison between 2022 and 2027
- 5.2 Bargaining power of buyers
- Exhibit 24: Chart on Bargaining power of buyers – Impact of key factors 2022 and 2027
- 5.3 Bargaining power of suppliers
- Exhibit 25: Bargaining power of suppliers – Impact of key factors in 2022 and 2027
- 5.4 Threat of new entrants
- Exhibit 26: Threat of new entrants – Impact of key factors in 2022 and 2027
- 5.5 Threat of substitutes
- Exhibit 27: Threat of substitutes – Impact of key factors in 2022 and 2027
- 5.6 Threat of rivalry
- Exhibit 28: Threat of rivalry – Impact of key factors in 2022 and 2027
- 5.7 Market condition
- Exhibit 29: Chart on Market condition - Five forces 2022 and 2027
6 Market Segmentation by Component
- 6.1 Market segments
- Exhibit 30: Chart on Component - Market share 2022-2027 (%)
- Exhibit 31: Data Table on Component - Market share 2022-2027 (%)
- 6.2 Comparison by Component
- Exhibit 32: Chart on Comparison by Component
- Exhibit 33: Data Table on Comparison by Component
- 6.3 Solutions - Market size and forecast 2022-2027
- Exhibit 34: Chart on Solutions - Market size and forecast 2022-2027 ($ million)
- Exhibit 35: Data Table on Solutions - Market size and forecast 2022-2027 ($ million)
- Exhibit 36: Chart on Solutions - Year-over-year growth 2022-2027 (%)
- Exhibit 37: Data Table on Solutions - Year-over-year growth 2022-2027 (%)
- 6.4 Services - Market size and forecast 2022-2027
- Exhibit 38: Chart on Services - Market size and forecast 2022-2027 ($ million)
- Exhibit 39: Data Table on Services - Market size and forecast 2022-2027 ($ million)
- Exhibit 40: Chart on Services - Year-over-year growth 2022-2027 (%)
- Exhibit 41: Data Table on Services - Year-over-year growth 2022-2027 (%)
- 6.5 Market opportunity by Component
- Exhibit 42: Market opportunity by Component ($ million)
7 Market Segmentation by Deployment
- 7.1 Market segments
- Exhibit 43: Chart on Deployment - Market share 2022-2027 (%)
- Exhibit 44: Data Table on Deployment - Market share 2022-2027 (%)
- 7.2 Comparison by Deployment
- Exhibit 45: Chart on Comparison by Deployment
- Exhibit 46: Data Table on Comparison by Deployment
- 7.3 On-premises - Market size and forecast 2022-2027
- Exhibit 47: Chart on On-premises - Market size and forecast 2022-2027 ($ million)
- Exhibit 48: Data Table on On-premises - Market size and forecast 2022-2027 ($ million)
- Exhibit 49: Chart on On-premises - Year-over-year growth 2022-2027 (%)
- Exhibit 50: Data Table on On-premises - Year-over-year growth 2022-2027 (%)
- 7.4 Cloud - Market size and forecast 2022-2027
- Exhibit 51: Chart on Cloud - Market size and forecast 2022-2027 ($ million)
- Exhibit 52: Data Table on Cloud - Market size and forecast 2022-2027 ($ million)
- Exhibit 53: Chart on Cloud - Year-over-year growth 2022-2027 (%)
- Exhibit 54: Data Table on Cloud - Year-over-year growth 2022-2027 (%)
- 7.5 Market opportunity by Deployment
- Exhibit 55: Market opportunity by Deployment ($ million)
8 Customer Landscape
- 8.1 Customer landscape overview
- Exhibit 56: Analysis of price sensitivity, lifecycle, customer purchase basket, adoption rates, and purchase criteria
9 Geographic Landscape
- 9.1 Geographic segmentation
- Exhibit 57: Chart on Market share by geography 2022-2027 (%)
- Exhibit 58: Data Table on Market share by geography 2022-2027 (%)
- 9.2 Geographic comparison
- Exhibit 59: Chart on Geographic comparison
- Exhibit 60: Data Table on Geographic comparison
- 9.3 APAC - Market size and forecast 2022-2027
- Exhibit 61: Chart on APAC - Market size and forecast 2022-2027 ($ million)
- Exhibit 62: Data Table on APAC - Market size and forecast 2022-2027 ($ million)
- Exhibit 63: Chart on APAC - Year-over-year growth 2022-2027 (%)
- Exhibit 64: Data Table on APAC - Year-over-year growth 2022-2027 (%)
- 9.4 North America - Market size and forecast 2022-2027
- Exhibit 65: Chart on North America - Market size and forecast 2022-2027 ($ million)
- Exhibit 66: Data Table on North America - Market size and forecast 2022-2027 ($ million)
- Exhibit 67: Chart on North America - Year-over-year growth 2022-2027 (%)
- Exhibit 68: Data Table on North America - Year-over-year growth 2022-2027 (%)
- 9.5 Europe - Market size and forecast 2022-2027
- Exhibit 69: Chart on Europe - Market size and forecast 2022-2027 ($ million)
- Exhibit 70: Data Table on Europe - Market size and forecast 2022-2027 ($ million)
- Exhibit 71: Chart on Europe - Year-over-year growth 2022-2027 (%)
- Exhibit 72: Data Table on Europe - Year-over-year growth 2022-2027 (%)
- 9.6 South America - Market size and forecast 2022-2027
- Exhibit 73: Chart on South America - Market size and forecast 2022-2027 ($ million)
- Exhibit 74: Data Table on South America - Market size and forecast 2022-2027 ($ million)
- Exhibit 75: Chart on South America - Year-over-year growth 2022-2027 (%)
- Exhibit 76: Data Table on South America - Year-over-year growth 2022-2027 (%)
- 9.7 Middle East and Africa - Market size and forecast 2022-2027
- Exhibit 77: Chart on Middle East and Africa - Market size and forecast 2022-2027 ($ million)
- Exhibit 78: Data Table on Middle East and Africa - Market size and forecast 2022-2027 ($ million)
- Exhibit 79: Chart on Middle East and Africa - Year-over-year growth 2022-2027 (%)
- Exhibit 80: Data Table on Middle East and Africa - Year-over-year growth 2022-2027 (%)
- 9.8 US - Market size and forecast 2022-2027
- Exhibit 81: Chart on US - Market size and forecast 2022-2027 ($ million)
- Exhibit 82: Data Table on US - Market size and forecast 2022-2027 ($ million)
- Exhibit 83: Chart on US - Year-over-year growth 2022-2027 (%)
- Exhibit 84: Data Table on US - Year-over-year growth 2022-2027 (%)
- 9.9 Thailand - Market size and forecast 2022-2027
- Exhibit 85: Chart on Thailand - Market size and forecast 2022-2027 ($ million)
- Exhibit 86: Data Table on Thailand - Market size and forecast 2022-2027 ($ million)
- Exhibit 87: Chart on Thailand - Year-over-year growth 2022-2027 (%)
- Exhibit 88: Data Table on Thailand - Year-over-year growth 2022-2027 (%)
- 9.10 Singapore - Market size and forecast 2022-2027
- Exhibit 89: Chart on Singapore - Market size and forecast 2022-2027 ($ million)
- Exhibit 90: Data Table on Singapore - Market size and forecast 2022-2027 ($ million)
- Exhibit 91: Chart on Singapore - Year-over-year growth 2022-2027 (%)
- Exhibit 92: Data Table on Singapore - Year-over-year growth 2022-2027 (%)
- 9.11 UK - Market size and forecast 2022-2027
- Exhibit 93: Chart on UK - Market size and forecast 2022-2027 ($ million)
- Exhibit 94: Data Table on UK - Market size and forecast 2022-2027 ($ million)
- Exhibit 95: Chart on UK - Year-over-year growth 2022-2027 (%)
- Exhibit 96: Data Table on UK - Year-over-year growth 2022-2027 (%)
- 9.12 Canada - Market size and forecast 2022-2027
- Exhibit 97: Chart on Canada - Market size and forecast 2022-2027 ($ million)
- Exhibit 98: Data Table on Canada - Market size and forecast 2022-2027 ($ million)
- Exhibit 99: Chart on Canada - Year-over-year growth 2022-2027 (%)
- Exhibit 100: Data Table on Canada - Year-over-year growth 2022-2027 (%)
- 9.13 Market opportunity by geography
- Exhibit 101: Market opportunity by geography ($ million)
10 Drivers, Challenges, and Trends
- 10.1 Market drivers
- 10.2 Market challenges
- 10.3 Impact of drivers and challenges
- Exhibit 102: Impact of drivers and challenges in 2022 and 2027
- 10.4 Market trends
11 Vendor Landscape
- 11.1 Overview
- 11.2 Vendor landscape
- Exhibit 103: Overview on Criticality of inputs and Factors of differentiation
- 11.3 Landscape disruption
- Exhibit 104: Overview on factors of disruption
- 11.4 Industry risks
- Exhibit 105: Impact of key risks on business
12 Vendor Analysis
- 12.1 Vendors covered
- Exhibit 106: Vendors covered
- 12.2 Market positioning of vendors
- Exhibit 107: Matrix on vendor position and classification
- 12.3 ACI Worldwide Inc.
- Exhibit 108: ACI Worldwide Inc. - Overview
- Exhibit 109: ACI Worldwide Inc. - Business segments
- Exhibit 110: ACI Worldwide Inc. - Key offerings
- Exhibit 111: ACI Worldwide Inc. - Segment focus
- 12.4 Ant Technology Group Co. Ltd.
- Exhibit 112: Ant Technology Group Co. Ltd. - Overview
- Exhibit 113: Ant Technology Group Co. Ltd. - Product / Service
- Exhibit 114: Ant Technology Group Co. Ltd. - Key offerings
- 12.5 Apple Inc.
- Exhibit 115: Apple Inc. - Overview
- Exhibit 116: Apple Inc. - Business segments
- Exhibit 117: Apple Inc. - Key news
- Exhibit 118: Apple Inc. - Key offerings
- Exhibit 119: Apple Inc. - Segment focus
- 12.6 Fidelity National Information Services Inc.
- Exhibit 120: Fidelity National Information Services Inc. - Overview
- Exhibit 121: Fidelity National Information Services Inc. - Business segments
- Exhibit 122: Fidelity National Information Services Inc. - Key news
- Exhibit 123: Fidelity National Information Services Inc. - Key offerings
- Exhibit 124: Fidelity National Information Services Inc. - Segment focus
- 12.7 Finastra
- Exhibit 125: Finastra - Overview
- Exhibit 126: Finastra - Product / Service
- Exhibit 127: Finastra - Key offerings
- 12.8 Fiserv Inc.
- Exhibit 128: Fiserv Inc. - Overview
- Exhibit 129: Fiserv Inc. - Business segments
- Exhibit 130: Fiserv Inc. - Key offerings
- Exhibit 131: Fiserv Inc. - Segment focus
- 12.9 Mastercard Inc.
- Exhibit 132: Mastercard Inc. - Overview
- Exhibit 133: Mastercard Inc. - Product / Service
- Exhibit 134: Mastercard Inc. - Key offerings
- 12.10 Microsoft Corp.
- Exhibit 135: Microsoft Corp. - Overview
- Exhibit 136: Microsoft Corp. - Business segments
- Exhibit 137: Microsoft Corp. - Key news
- Exhibit 138: Microsoft Corp. - Key offerings
- Exhibit 139: Microsoft Corp. - Segment focus
- 12.11 Mindgate Solutions Pvt. Ltd.
- Exhibit 140: Mindgate Solutions Pvt. Ltd. - Overview
- Exhibit 141: Mindgate Solutions Pvt. Ltd. - Product / Service
- Exhibit 142: Mindgate Solutions Pvt. Ltd. - Key offerings
- 12.12 Montran Corp.
- Exhibit 143: Montran Corp. - Overview
- Exhibit 144: Montran Corp. - Product / Service
- Exhibit 145: Montran Corp. - Key offerings
- 12.13 PayPal Holdings Inc.
- Exhibit 146: PayPal Holdings Inc. - Overview
- Exhibit 147: PayPal Holdings Inc. - Product / Service
- Exhibit 148: PayPal Holdings Inc. - Key offerings
- 12.14 Tata Consultancy Services Ltd.
- Exhibit 149: Tata Consultancy Services Ltd. - Overview
- Exhibit 150: Tata Consultancy Services Ltd. - Business segments
- Exhibit 151: Tata Consultancy Services Ltd. - Key news
- Exhibit 152: Tata Consultancy Services Ltd. - Key offerings
- Exhibit 153: Tata Consultancy Services Ltd. - Segment focus
- 12.15 Temenos Headquarters SA
- Exhibit 154: Temenos Headquarters SA - Overview
- Exhibit 155: Temenos Headquarters SA - Business segments
- Exhibit 156: Temenos Headquarters SA - Key news
- Exhibit 157: Temenos Headquarters SA - Key offerings
- Exhibit 158: Temenos Headquarters SA - Segment focus
- 12.16 Visa Inc.
- Exhibit 159: Visa Inc. - Overview
- Exhibit 160: Visa Inc. - Product / Service
- Exhibit 161: Visa Inc. - Key offerings
- 12.17 Volante Technologies Inc.
- Exhibit 162: Volante Technologies Inc. - Overview
- Exhibit 163: Volante Technologies Inc. - Product / Service
- Exhibit 164: Volante Technologies Inc. - Key offerings
13 Appendix
- 13.1 Scope of the report
- 13.2 Inclusions and exclusions checklist
- Exhibit 165: Inclusions checklist
- Exhibit 166: Exclusions checklist
- 13.3 Currency conversion rates for US$
- Exhibit 167: Currency conversion rates for US$
- 13.4 Research methodology
- Exhibit 168: Research methodology
- Exhibit 169: Validation techniques employed for market sizing
- Exhibit 170: Information sources
- 13.5 List of abbreviations
- Exhibit 171: List of abbreviations
Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions. With over 500 specialized analysts, Technavio's report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio's comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.
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Uncategorized
February Employment Situation
By Paul Gomme and Peter Rupert The establishment data from the BLS showed a 275,000 increase in payroll employment for February, outpacing the 230,000…
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By Paul Gomme and Peter Rupert
The establishment data from the BLS showed a 275,000 increase in payroll employment for February, outpacing the 230,000 average over the previous 12 months. The payroll data for January and December were revised down by a total of 167,000. The private sector added 223,000 new jobs, the largest gain since May of last year.
Temporary help services employment continues a steep decline after a sharp post-pandemic rise.
Average hours of work increased from 34.2 to 34.3. The increase, along with the 223,000 private employment increase led to a hefty increase in total hours of 5.6% at an annualized rate, also the largest increase since May of last year.
The establishment report, once again, beat “expectations;” the WSJ survey of economists was 198,000. Other than the downward revisions, mentioned above, another bit of negative news was a smallish increase in wage growth, from $34.52 to $34.57.
The household survey shows that the labor force increased 150,000, a drop in employment of 184,000 and an increase in the number of unemployed persons of 334,000. The labor force participation rate held steady at 62.5, the employment to population ratio decreased from 60.2 to 60.1 and the unemployment rate increased from 3.66 to 3.86. Remember that the unemployment rate is the number of unemployed relative to the labor force (the number employed plus the number unemployed). Consequently, the unemployment rate can go up if the number of unemployed rises holding fixed the labor force, or if the labor force shrinks holding the number unemployed unchanged. An increase in the unemployment rate is not necessarily a bad thing: it may reflect a strong labor market drawing “marginally attached” individuals from outside the labor force. Indeed, there was a 96,000 decline in those workers.
Earlier in the week, the BLS announced JOLTS (Job Openings and Labor Turnover Survey) data for January. There isn’t much to report here as the job openings changed little at 8.9 million, the number of hires and total separations were little changed at 5.7 million and 5.3 million, respectively.
As has been the case for the last couple of years, the number of job openings remains higher than the number of unemployed persons.
Also earlier in the week the BLS announced that productivity increased 3.2% in the 4th quarter with output rising 3.5% and hours of work rising 0.3%.
The bottom line is that the labor market continues its surprisingly (to some) strong performance, once again proving stronger than many had expected. This strength makes it difficult to justify any interest rate cuts soon, particularly given the recent inflation spike.
unemployment pandemic unemploymentUncategorized
Mortgage rates fall as labor market normalizes
Jobless claims show an expanding economy. We will only be in a recession once jobless claims exceed 323,000 on a four-week moving average.
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Everyone was waiting to see if this week’s jobs report would send mortgage rates higher, which is what happened last month. Instead, the 10-year yield had a muted response after the headline number beat estimates, but we have negative job revisions from previous months. The Federal Reserve’s fear of wage growth spiraling out of control hasn’t materialized for over two years now and the unemployment rate ticked up to 3.9%. For now, we can say the labor market isn’t tight anymore, but it’s also not breaking.
The key labor data line in this expansion is the weekly jobless claims report. Jobless claims show an expanding economy that has not lost jobs yet. We will only be in a recession once jobless claims exceed 323,000 on a four-week moving average.
From the Fed: In the week ended March 2, initial claims for unemployment insurance benefits were flat, at 217,000. The four-week moving average declined slightly by 750, to 212,250
Below is an explanation of how we got here with the labor market, which all started during COVID-19.
1. I wrote the COVID-19 recovery model on April 7, 2020, and retired it on Dec. 9, 2020. By that time, the upfront recovery phase was done, and I needed to model out when we would get the jobs lost back.
2. Early in the labor market recovery, when we saw weaker job reports, I doubled and tripled down on my assertion that job openings would get to 10 million in this recovery. Job openings rose as high as to 12 million and are currently over 9 million. Even with the massive miss on a job report in May 2021, I didn’t waver.
Currently, the jobs openings, quit percentage and hires data are below pre-COVID-19 levels, which means the labor market isn’t as tight as it once was, and this is why the employment cost index has been slowing data to move along the quits percentage.
3. I wrote that we should get back all the jobs lost to COVID-19 by September of 2022. At the time this would be a speedy labor market recovery, and it happened on schedule, too
Total employment data
4. This is the key one for right now: If COVID-19 hadn’t happened, we would have between 157 million and 159 million jobs today, which would have been in line with the job growth rate in February 2020. Today, we are at 157,808,000. This is important because job growth should be cooling down now. We are more in line with where the labor market should be when averaging 140K-165K monthly. So for now, the fact that we aren’t trending between 140K-165K means we still have a bit more recovery kick left before we get down to those levels.
From BLS: Total nonfarm payroll employment rose by 275,000 in February, and the unemployment rate increased to 3.9 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care, in government, in food services and drinking places, in social assistance, and in transportation and warehousing.
Here are the jobs that were created and lost in the previous month:
In this jobs report, the unemployment rate for education levels looks like this:
- Less than a high school diploma: 6.1%
- High school graduate and no college: 4.2%
- Some college or associate degree: 3.1%
- Bachelor’s degree or higher: 2.2%
Today’s report has continued the trend of the labor data beating my expectations, only because I am looking for the jobs data to slow down to a level of 140K-165K, which hasn’t happened yet. I wouldn’t categorize the labor market as being tight anymore because of the quits ratio and the hires data in the job openings report. This also shows itself in the employment cost index as well. These are key data lines for the Fed and the reason we are going to see three rate cuts this year.
recession unemployment covid-19 fed federal reserve mortgage rates recession recovery unemploymentUncategorized
Inside The Most Ridiculous Jobs Report In History: Record 1.2 Million Immigrant Jobs Added In One Month
Inside The Most Ridiculous Jobs Report In History: Record 1.2 Million Immigrant Jobs Added In One Month
Last month we though that the January…
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Last month we though that the January jobs report was the "most ridiculous in recent history" but, boy, were we wrong because this morning the Biden department of goalseeked propaganda (aka BLS) published the February jobs report, and holy crap was that something else. Even Goebbels would blush.
What happened? Let's take a closer look.
On the surface, it was (almost) another blockbuster jobs report, certainly one which nobody expected, or rather just one bank out of 76 expected. Starting at the top, the BLS reported that in February the US unexpectedly added 275K jobs, with just one research analyst (from Dai-Ichi Research) expecting a higher number.
Some context: after last month's record 4-sigma beat, today's print was "only" 3 sigma higher than estimates. Needless to say, two multiple sigma beats in a row used to only happen in the USSR... and now in the US, apparently.
Before we go any further, a quick note on what last month we said was "the most ridiculous jobs report in recent history": it appears the BLS read our comments and decided to stop beclowing itself. It did that by slashing last month's ridiculous print by over a third, and revising what was originally reported as a massive 353K beat to just 229K, a 124K revision, which was the biggest one-month negative revision in two years!
Of course, that does not mean that this month's jobs print won't be revised lower: it will be, and not just that month but every other month until the November election because that's the only tool left in the Biden admin's box: pretend the economic and jobs are strong, then revise them sharply lower the next month, something we pointed out first last summer and which has not failed to disappoint once.
In the past month the Biden department of goalseeking stuff higher before revising it lower, has revised the following data sharply lower:
— zerohedge (@zerohedge) August 30, 2023
- Jobs
- JOLTS
- New Home sales
- Housing Starts and Permits
- Industrial Production
- PCE and core PCE
To be fair, not every aspect of the jobs report was stellar (after all, the BLS had to give it some vague credibility). Take the unemployment rate, after flatlining between 3.4% and 3.8% for two years - and thus denying expectations from Sahm's Rule that a recession may have already started - in February the unemployment rate unexpectedly jumped to 3.9%, the highest since February 2022 (with Black unemployment spiking by 0.3% to 5.6%, an indicator which the Biden admin will quickly slam as widespread economic racism or something).
And then there were average hourly earnings, which after surging 0.6% MoM in January (since revised to 0.5%) and spooking markets that wage growth is so hot, the Fed will have no choice but to delay cuts, in February the number tumbled to just 0.1%, the lowest in two years...
... for one simple reason: last month's average wage surge had nothing to do with actual wages, and everything to do with the BLS estimate of hours worked (which is the denominator in the average wage calculation) which last month tumbled to just 34.1 (we were led to believe) the lowest since the covid pandemic...
... but has since been revised higher while the February print rose even more, to 34.3, hence why the latest average wage data was once again a product not of wages going up, but of how long Americans worked in any weekly period, in this case higher from 34.1 to 34.3, an increase which has a major impact on the average calculation.
While the above data points were examples of some latent weakness in the latest report, perhaps meant to give it a sheen of veracity, it was everything else in the report that was a problem starting with the BLS's latest choice of seasonal adjustments (after last month's wholesale revision), which have gone from merely laughable to full clownshow, as the following comparison between the monthly change in BLS and ADP payrolls shows. The trend is clear: the Biden admin numbers are now clearly rising even as the impartial ADP (which directly logs employment numbers at the company level and is far more accurate), shows an accelerating slowdown.
But it's more than just the Biden admin hanging its "success" on seasonal adjustments: when one digs deeper inside the jobs report, all sorts of ugly things emerge... such as the growing unprecedented divergence between the Establishment (payrolls) survey and much more accurate Household (actual employment) survey. To wit, while in January the BLS claims 275K payrolls were added, the Household survey found that the number of actually employed workers dropped for the third straight month (and 4 in the past 5), this time by 184K (from 161.152K to 160.968K).
This means that while the Payrolls series hits new all time highs every month since December 2020 (when according to the BLS the US had its last month of payrolls losses), the level of Employment has not budged in the past year. Worse, as shown in the chart below, such a gaping divergence has opened between the two series in the past 4 years, that the number of Employed workers would need to soar by 9 million (!) to catch up to what Payrolls claims is the employment situation.
There's more: shifting from a quantitative to a qualitative assessment, reveals just how ugly the composition of "new jobs" has been. Consider this: the BLS reports that in February 2024, the US had 132.9 million full-time jobs and 27.9 million part-time jobs. Well, that's great... until you look back one year and find that in February 2023 the US had 133.2 million full-time jobs, or more than it does one year later! And yes, all the job growth since then has been in part-time jobs, which have increased by 921K since February 2023 (from 27.020 million to 27.941 million).
Here is a summary of the labor composition in the past year: all the new jobs have been part-time jobs!
But wait there's even more, because now that the primary season is over and we enter the heart of election season and political talking points will be thrown around left and right, especially in the context of the immigration crisis created intentionally by the Biden administration which is hoping to import millions of new Democratic voters (maybe the US can hold the presidential election in Honduras or Guatemala, after all it is their citizens that will be illegally casting the key votes in November), what we find is that in February, the number of native-born workers tumbled again, sliding by a massive 560K to just 129.807 million. Add to this the December data, and we get a near-record 2.4 million plunge in native-born workers in just the past 3 months (only the covid crash was worse)!
The offset? A record 1.2 million foreign-born (read immigrants, both legal and illegal but mostly illegal) workers added in February!
Said otherwise, not only has all job creation in the past 6 years has been exclusively for foreign-born workers...
... but there has been zero job-creation for native born workers since June 2018!
This is a huge issue - especially at a time of an illegal alien flood at the southwest border...
... and is about to become a huge political scandal, because once the inevitable recession finally hits, there will be millions of furious unemployed Americans demanding a more accurate explanation for what happened - i.e., the illegal immigration floodgates that were opened by the Biden admin.
Which is also why Biden's handlers will do everything in their power to insure there is no official recession before November... and why after the election is over, all economic hell will finally break loose. Until then, however, expect the jobs numbers to get even more ridiculous.
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