May’s employment report revealed some mixed messages but still showed stronger-than-expected job growth, an indication that the economy is still holding strong. The consensus is still expecting a recession, but we’re not there yet. One important reason why is because of household savings levels. Households were able to save roughly $2 trillion during the pandemic and half of that still hasn’t been spent, see chart below. That is why consumer spending remains so strong, in particular consumer spending on services such as airlines, hotels, restaurants, etc.