taylor: let's take a look at how the equities performed on the day. it is mostly red. the russell 2000, those reflationary stocks catching the bid. it is all about the bond story. yields continue to climb particularly on the short end of the curve. it is back in the cyclicals. that trend continues. that was the markets rep. what did you miss starts now.

caroline: what a week at has been for these markets. we still have to digest tomorrow's key data point, the u.s. jobs data. we are going to be focusing on where these jobs numbers go. adjusting expectations about fed policy in 2022. we learned jobless claims rose last week. it was not enough to tempt down on the expectation this is a jobs market in recovery. labor market withstanding the recent surge in covid cases. romaine: i guess the big question is how long this trend continues. the average estimate of economist and a bloomberg survey for payrolls here. manufacturing looking for about 35,000. two interesting points to keep

an eye on, average hourly earnings. a bit of an acceleration on year-over-year. 4.2%. a little bit of deceleration. the labor force participation rate is projected in the bloomberg survey to take up to 61.9%. let's get some perspective from someone who knows a lot more about this. economic policy institute senior economist joining us right now. happy new year to year. let's take a look at the numbers. when we look back at the monthly numbers we have gotten, it has been relatively encouraging. we have had a couple bumps along the way. i wonder how close you think we are to digging ourselves out of the hole covid brought to this economy. >> i think we have made great progress over the last year. we have average 550,000 jobs a month just in 2020 one.

if expectations continue as we have seen from many commentators, we are going to get close to 7 million jobs. that is faster than ever -- than any recovery seen in the last two recessions. the fiscal support has been feeding the recovery this year. taylor: that is leading to some like james bullard saying measuring labor force participation and employment numbers to pre-pandemic levels, that is no longer the right benchmark. as you are thinking about fulham employment. do you agree? >> we definitely want to fill the benchmark to pre-pandemic labor conditions. the unemployment mark is overstating the conditions today. some of the people left the labor force when the pandemic hit. many people lost their jobs. some people quit. there are many things that

happened in the pandemic. now almost two years ago. we have seen even as we have seen record numbers quit, we have seen a lot more hiring. we have seen a return of the labor force. it is expected to keep going up in the coming months. caroline: those who are not coming back, why aren't they? is it omicron that could be holding back or is it people have exited because they have a new viewpoint? >> there is a fair amount of diversity in what is happening with people. certainly omicron has led to many early retirements. many people have not returned who might have returned. there are people concerned about schools and what is happening right now. some school systems are closing because of omicron. that has led to depressed labor force participation the last year. there are fewer opportunities.

job openings have risen. they did decline in november. we have yet to see what the data will show for december. the ebbs and flows -- some people have not found footing yet. romaine: some of the people who left, we have talked about this on the show. some of these were older workers who decided i am done. i'm going to retire and move on. we saw a huge chunk of younger workers who dropped out of the labor force. i'm wondering if or when we start to see them come back in. >> i'm very optimistic we will see them come back in the upcoming months. if the labor market continues to recover and we expect a hick up with omicron. we will not see that in the data tomorrow. the data is before the huge surge. we have will see a pickup in january date appeared maybe in february we will see this effect on the labor market and it could be large but hopefully short-lived.

after that, i hope we have a return to the recovery resolve for most of 2021. as with the return of the labor force, the great recession, it does often take some time for workers to see opportunities and to go back in. they may become unemployed for a spell as they actively start looking. many people may jump from out of the labor force to employment. we will see that in much of 2022. taylor: appreciate your time and perspective. coming up, we are going to be sticking with jobs. we are focusing on the labor shortage and why it may continue long after covid. our next guest, the chief economist at up work. this is bloomberg. ♪

taylor: let's get back to the jobs report. our next guest sees reason for optimism. the chief economist at up work. i am curious as we push forward to the jobs report tomorrow. from your perspective, what labor shortage do you see if any? >> i still think we are dealing a little bit with a labor shortage at the lower scale end of the labor market. still have a lot of people with pent-up savings. still people who are hesitant to come back to work due to fears of covid or childcare problems or whatever is keeping them by. it really is easing. i do think we are going to have strong job growth in december and going into january and february.

there is some really good tailwind as people return to the labor force. the supply shortage, the big crunch voting back the recovery over the last six months, i think we are working our way through that romaine: i'm curious about the types of jobs the people coming back into the workforce, what they are gravitating to. there has been a lot of anecdotal evidence they are going to more freelance top jobs -- freelance type jobs weather is for the flexibility or whatever other reasons should i'm curious what you are seeing in those trends and how it shakes out in the labor market. >> you can see a growth in people looking to freelance for sure across a variety of data sets. you can see it in the bls report self-employment has more than recovered while payroll employment is still significantly below. we can see in our data.

he put out a survey every year and we have seen growth. you can also see it in up work, which has continued to grow as a company. caroline: world's largest work marketplace. you connect freelancer's with the opportunities. you are a small business owner yourself. i believe it is a bowling alley you run. the seasonal worker right now, how hard argue, how hard are the people at up work trying to hold onto them, not wanting to let them go as we waved goodbye to the holiday season? >> i think that is really important over the next few months and potentially a little bit in december. normally employers do a lot of hiring in the holidays and come january, they let those seasonal workers go. that kids -- that get smoothed out any the adjustment factors. what we are going to see this

year is people who have been struggling with labor shortages for the last six months and for the last year, those seasonal hires are going talk hold onto them. we are certainly doing the best we can to hold onto every single worker. we have enough people to operate could it has been a tight labor market. we tried to hold on to everyone we can for that reason. taylor: in that, what are the employees asking? is it still a parklike flexibility? is it no more about the free food and game table? what are the key asks that you are hearing about? ? it depends on the job. it depends on the occupation. for some workers, they are going to start asking for things like health care. for those who already have benefits like that, they are going to look for more

flexibility. we see that in the growth of remote work. a lot of workers got a little bit of a taste of flexibility. now they want more of that. that means looking for more flexibility around time of the day you work, the ability to stay remote. that is going to be a huge deal for a lot of employers. people who think their workers are coming back to the office may struggle to get them back to the office. they may be dealing with extra turnover from that. offering workers remote work is going to be an important part of the retention struggle. caroline: up work is across 180 countries. how similar are the trends we see in the u.s. being worked out over the world? >> you hear anecdotal reports about labor shortages in countries all over the world. there is some covid specific factors holding back labor supply. i do think in the u.s. that labor shortages are more cute than they are elsewhere.

there are a variety of reasons for that. some of them having to do with the nature of our policy response to the pandemic should we had one of the largest policy responses in the world. that pushed people's incomes up. that is giving people the ability to hold back from work until they are ready to do so. caroline: always great to get your perspective. up work's chief economist and a small is this owner. we thank you for your time. they focus on jobs. now we are going to focus on outer space. a few jobs going there at the moment. we are moments away from the latest launch of spacex's starling satellite. we are going to be bringing you live coverage. expertise coming from ed ludlow, our resident space expert should taylor, he has been reduced to tears in the past.

taylor: it is only when we land a rover on mars. other times, i can hold it together. caroline: all about space camp. another key moment in the overall focus to romaine: i'm keeping an eye on that. we are going to cover that when we come back. caroline: stick with us. this is bloomberg. ♪

caroline: a new spacex lunch. this time, 49 starling satellites are going to be launched into space. on a falcon nine rocket being powered by spacex. let's get to our resident export , ed ludlow, to walk us through what we are going to expect. >> first launch of the year. very excited. this booster is the same one

that carries the inspiration four mission. the four civilians that went into space for three days. the starling network is fully operational globally. they're adding to the constellation of low-earth orbit satellites to improve the service. this is a service you pay for. spacex said they have 145,000 users in 21 different countries regularly using space-based internet. he is flabbergasted. taylor: maybe we lost him. maybe he is out to space. i will take over. to put this into perspective, what we have learned, what we experienced last year and pushes forward to the rest of the year. >> as they left off, i want to take a moment to look at that beautiful image. the thing about this launch is

as they approach max q and a 60 seconds time, the moment of maximum aerodynamic stress on the rocket, is it is all about reusability. elon musk has been canted the actual launch business has a limit. $3 billion a year annually. as they climb up into the atmosphere. our bloomberg intelligence say right now, simply launching rockets in space is a $5 million per year business globally. the real opportunity is in the data generation. >> and to lift off. complexity nine a at kennedy space center carrying our stack of 49 starling satellites. >> must has talked about how -- space-based internet could be a $30 billion a year business. that is a high-margin business once you get through the capex,

which elon musk says could be five or $10 billion before spacex as cash flow positive. they may invest $30 billion here. they are making progress. one quick bit. spacex wanted to do 48 missions. they did 31. part of what is so astonishing is how regularly we have this conversation. this is now normal for this company. caroline: it is indeed paired let's listen in for a moment. just at that moment, we start to lose the volume should never mind. you spoke over the lunch. this being another successful attempt of space bound flight. tell us about the competition. this is about starlight. this is about service of the internet. this is also showing the power of spacex and one the u.s. government has turned to.

>> we go back to this idea of reusability. this booster you see on your screen now where its main engine is about to start off -- to shut off any moment has not only flown the inspiration four mission, which carries the civilian astronauts to space but it has flown two missions to space force. it is reusability. you do have new players in the wings trying to catch up with spacex. rocket lab, which is a new zealand and u.s.-based company. you see that first stage of separation. the booster has separated. the second stage carries on. that is the one carrying the payload of 49 star like satellites. taylor: we always appreciate your knowledge and expertise. you're going to be sticking with us as we continue to watch how all of this develops and we will bring you back shortly once we get some of the stages and the

relenting portions. we do want to get back to talking about jobs day, which i know we are looking forward to tomorrow. we heard earlier from st. louis fed president james bullard. to start to raise interest rates. responding really to the surge in inflation. let's tie this together with bloomberg's olivia rockman. what did you make from some of the comments we heard today talking about we are where we are when it comes to jobs and labor market and maybe we should not be comparing it to some of our pre-pandemic levels and some of this focus on inflation? >> it is clear some of the fed officials view of maximum employment has shifted since the beginning of this pandemic. and we started out with this crisis, it seems like getting back to 2019 levels is the goal. the psychology now is more of a focus on the unemployment rate,

which is close to 2020 doubles rather than on other metrics. romaine: unemployment rate and we continue to see? down here. when you measure that against where we were pre-pandemic with regard to the level of jobs out there, and where we are today, do those sync up still yucca >> -- still? ? the unemployment rate is at 4.2% and historic low was 3.5. only about .7 percentage points. we are still about 4 million jobs short of pre-pandemic levels. it could just mean a fraction of this 4 million people are voluntarily sitting on the sidelines and they are not necessarily having a hard time finding a job. caroline: we are also still checking in on how the launch is going.

olivia, we are in unprecedented territory when it comes to monetary policy. it comes to the -- when it comes to the debt appeared the people you're speaking to, how much have they been upended by what has been coming out of the federal reserve minutes and what did they look at? inflation reads or data? >> it feels like inflation has become the issue of the hour. the unemployment issue has faded away especially because we have this data showing quicker job openings. we know workers have more power than they had in other recessions. the fed yesterday showed real concern over public opinion of inflation and the issue of lower income households not being able to afford important household items like gas and food. it does seem the attention has shifted to controlling inflation and away from the labor market recovery.

taylor: we certainly heard that about the struggles of trying to afford basic food necessities. i'm curious about any structural shift you see underway. we were having a great conversation earlier. this shift particularly when it comes to the labor force participation. did something change permanently or are we thinking we can eventually see some of these people back into the labor force ? >> is important -- schools closed in chicago recently and we sell other districts not able to reopen. that prevents mothers from being able to work on a regular schedule. you have people very concerned about the health of the pandemic. it is going to take the pandemic for us to understand whether the labor force participation rate will recover or remain at this lower level. romaine: overall, we are talking

about job growth here that has averaged in 2020 one, something like 500 k or something like that. is there a general sense here of what the longer-term sustainable rate of growth can be over the next couple of years? >> we are seeing estimates from economists at deutsche's and other wall street banks they are expecting this year to be somewhere under the 300 to three to 50,000 a month on average. we are still 4 million jobs short of where we were before the pandemic. there are still jobs to be recovered. moving into 2023, it is not going to be as easy to sustain that pace. romaine: i want to look ahead. we are going to focus on the jobs report tomorrow. you get into next week and you have another inflation report coming. retail sales. another -- a lot of other

metrics that would factor heavily into monetary policy. what are you looking at with regards to some of those estimates on some of those economic data points? >> inflation is expected to maintain a faster than historical pace. we did see signs in the pmi this week that the effects of the really intense price increases we saw earlier in 21 are starting to fade. where looking at a 7.1% estimate next week. we expect that will start to cool off in the coming months. romaine: with the report we get tomorrow, you're going to get that wage number that goes up. people are still predicting real average hourly earnings to go down. >> that is right. it is still wage increases and offsetting the price increases

at the same rate. romaine: olivia is going to be all over that. we are going to get back now to what you are watching on your screen, which is the spacex star link, which went back up there. i want to bring ed ludlow back into the conversation. if you can see what is on the screen, can you make sense of it for our viewers as to what we are waiting to see you next? taylor: the booster landed back on a drum ship in the atlantic. it is a shortfall of gravity has. spacex has started the year perfectly paired in six minutes, it will deploy the payload, which is 49 more satellites. the space-based internet system which is operational globally. the news today is spacex user base for that system has grown to 145,000 users globally. they have a long way to go

before being cash flow positive. romaine: obviously you just bring a wealth of knowledge to this. keep an eye here on the latest spacex launch. we are going to say goodbye and to what did you miss. that wreps up our coverage. keep watching bloomberg. >> from the heart of where innovation, money and power collide, in silicon valley and beyond, this is bloomberg technology with emily chang. caroline: coming up, on the one-year anniversary of january 6 attack on the u.s. capitol, we will speak with representative connor, democrat of california. what he has to say about