Former Home Depot CEO sounds alarm on 'tremendous shift' in labor market

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A erstwhile apical firm America executive is informing that the U.S. economy is not connected a accelerated way to recovery, arsenic higher ostentation and much wide layoffs loom complete markets.

"The wide organization will not beryllium duped by this aversion to effort and blasted ostentation connected firm America. It starts astatine nan earthy materials, it starts astatine transportation, it starts astatine energy," erstwhile Home Depot and Chrysler CEO Bob Nardelli said connected "Cavuto: Coast to Coast" Monday. "A full big of things that are driving this up, costs increases."

"We're now seeing group being laid off," he continued, "If you look astatine chips, they've laid disconnected almost 40,000 people. We're seeing a tremendous displacement successful employment retired location wherever group are being laid off."

In nan past 2 weeks, companies for illustration Cisco, Snap, Estée Lauder, Amazon, Citigroup and UPS person each announced layoffs arsenic executives tighten their belts amid complaint volatility.

JANET YELLEN WARNS HIGH PRICES COULD BE HERE TO STAY

The gait of occupation cuts by U.S. employers accelerated astatine nan commencement of 2024, arsenic a caller study from business patient Challenger, Gray & Christmas recovered that companies planned 82,307 occupation cuts successful January, a important 136% summation from nan erstwhile month.

However, that is down astir 20% from nan aforesaid clip 1 twelvemonth ago. It marked nan second-highest layoff full for nan period of January successful information going backmost to 2009.

"Ford laid group disconnected because of EV[s]. GM laid group disconnected because of nan cruise program. We're conscionable seeing Stellantis laic group disconnected because of nan UAW costs increase," Nardelli said. "So no, I deliberation we're still successful an inflationary period. I deliberation we're not going to spot a soft landing would beryllium my prediction, but I dream I'm wrong."

The Labor Department said Tuesday that nan user value index, a wide measurement of nan value of mundane equipment including gasoline, groceries and rent, rose 0.3% successful January from nan erstwhile month, much than expected.

Prices climbed 3.1% from nan aforesaid clip past year, which besides came successful supra nan 2.9% anticipation from Refinitiv economists.

Nardelli correctly predicted that Tuesday’s CPI number would rise, meaning that unit remains to proceed nan Fed’s fierce complaint trajectory.

The erstwhile CEO noted that nan nationalist doesn’t genuinely understand really precocious rates "are killing" mediate and lower-market companies.

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"We've seen companies wherever we've had $2 cardinal of liking rates now detonate to $12, $13, $14 million. And nan free rate travel that we make is going to salary nan man," Nardelli explained. "We cannot spend nan type of liking rates that we're buried [in] today. I mean, you couldn't spend it arsenic an individual successful trying to equilibrium your budget."

"This is each about, I think, trying to bargain votes. This is each astir an management that is retired of control," he continued. "We person a beardown bias towards spending versus having a blimpish argumentation aliases a sustainable future."

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FOX Business’ Megan Henney contributed to this report.