Looking back at previous rate hike cycles since the 1950s, the median amount of time it took from when the Federal Reserve first started hiking interest rates to when the unemployment rate bottomed and moved higher is 14 months. Using this historical pattern as a guide—with the first Fed hike taking place in March 2022—we can expect to see the unemployment rate increase within the next few months. The bottom line is that it usually takes 12 to 18 months for the Fed to soften the labor market, and today is no different.
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