This is Chanelle Bunger with the Becker Private Equity and Business Podcast. Today I'm excited to speak with regular guest, Rick Kess from RSN, who joins us weekly to discuss economic and private equity turns that he's keeping an eye on. Rick, thank you as always for joining me today. Why don't you take it away and tell us about some of the things that you're seeing out there?

Yeah, I'd say the three core items that we always keep our mind on, and where a lot of our time, especially with our economists, focus on is jobs, inflation, and interest rates. And those three items are all interconnected and have relationships with each other. And I was speaking with one of our economists this morning talking about the Jolt's report, which measures the job openings report. And what was interesting there is it is down to its lowest level since March of 2021. So it was down 6.6 % this month. And what that means is that it's really signaling, I think, to economists out there, including ours, that it's another data point that I think supports the position that the Fed will likely stay at its current interest rate and not increase the rate next week when they meet. Just to put some context around a drop of 6.6 % in the job openings report, that means really where we're at today is that there is 1.3 job openings to every job seeker. And some context to that, we were above two at points in the pandemic period. But pre-pandemic, we were at about 1.2 job openings per job seeker.

So we were really close to where we were from a general openings perspective and a job market perspective. So hopefully that means there's some easing in the job market perspective for employers and for private equity companies to be able to go out, find the talent they need to be able to do the growth that they're hoping for. And then also, obviously, given private equity's tendency to highly leverage a lot of the acquisitions that they incur or that they go through, interest rates ideally will continue to hold steady, which will be another good sign, I think, for our clients. Another good data point that we were talking about with our economist group the other day was the inflation report. I think we were seeing inflation fall to a pretty decent point. It was right around 3.2% right now. I think that the positive news there is that I think the expectation was to get to 3%, we would need the economy to have about a 5% unemployment rate. But we're at 3.2% and unemployment's at 3.9%. I think there is some positive note there that perhaps the overall inflationary environment can continue to be at a relatively respectful level without having to get to an unemployment rate, which would be close to five, which then that dovetails all back into interest rates and saying, well, the Fed should feel fairly comfortable knowing that, okay, well, if the job market continues to be fairly strong and unemployment isn't getting excessive amounts, but inflation has curtailed and got trending down our whole below three, perhaps that's another indication that interest rates will remain steady.

Hopefully this next meeting and maybe in 2024, we'll start to see some pullback on the interest rate environment, which will obviously be a very positive sign that private equity for 2024 to go into a year where hopefully they'll see a lot of activity in transaction environments. So I'd say those are the things that we continue to watch. It's always about jobs, inflation and interest rates, and they're all really pretty well related to each other. And I think that gives you some context of how we look at it and how we're synthesizing it down to our clients so that they can think about 2024 plans and how that those might impact what they're looking to do.

Perfect. Well, Rick, thank you, as always, for keeping us updated on all these trends and for joining me today on the Becker Private Equity and Business Podcast. Thank you.

Thank you.