• Overall nonfarm payrolls rose by only +199k, a significant miss relative to the market expectation of +450k.
• Weakness in the state and local government labor market continued in December 2021. For a fifth straight month the change in state and local government jobs was negative, they were -10k in December.
• COVID-19 and Omicron variant spread is even worse to begin 2022 compared to 2021. This means state and local labor market weakness could persist into 2022.
• State and local governments are still almost 1 million workers shy of their pre-COVID peak.
• We still believe the $650 billion of fiscal policy Washington lawmakers approved for public finance entities in 2021 is enough to keep state and local government credit stabilized.

Download the full article

Read more Municipal Commentary