The latest Bureau of Labor Statistics’ Employment Situation
report sets out a 209,000-increase in the total number of U.S. jobs in July
versus June.
It’s a good number, but not one to inspire cartwheels. Or
maybe we’re becoming spoiled. The average month-to-month gain through the first
six months of this year was a modestly-higher 233,000.
Year-over-year total employment has risen by 2.6 million
jobs. That’s a steady upward progression from July 2013’s year-over-year figure
of +2.3 million; July 2012’s +2.2 million; July 2011’s +1.5 million; and July
2010’s -0.2 million.
Complementing the latest employment data has been a string
of other good news concerning the U.S. economy.
Initial jobless claims were 302,000 for the latest week
ending July 26. The prior week, they had been an exceptionally low 279,000. They’ve
been hovering around 300,000 for the past couple of months. This “metric”
rarely, even during a “boom”, falls below 300,000.
For July, the Conference Board’s consumer confidence index
rose to 90.9 from 86.4 the month before. It now stands at its highest level
since October 2007’s 95.2.
At 100.0, consumers are quite positive about their job and
lifestyle prospects.
And most impressive of all, as reported by the Bureau of
Economic Analysis (BEA), Q2 annualized “real” (i.e., inflation-adjusted) gross
domestic product (GDP) growth was +4.0% after a horrendous -2.1% in Q1.
Nearly everyone in the forecasting fraternity had been
assuming Q1’s “jaw-dropper” was an aberration brought on by winter weather that
was vicious beyond the normal, but it’s good to have that conclusion confirmed.
Q2’s GDP advance was driven by durable goods purchases
(+14.0% quarter to quarter annualized) and private investment (+17.0%)
The Federal Reserve is sufficiently convinced of the
economy’s strength that it is lowering its monthly bond-buying program by
another notch, to $25 billion, with an October target for withdrawing this form
of monetary stimulus altogether.
There was one notably unfortunate “optic” in the report. The
unemployment rate bobbed up, rather than dropping further. It now stands at
6.2% compared with 6.1% in June. Keep in mind, though, that the economy-wide
jobless rate was significantly higher in July 2013, at 7.3%; July 2012, 8.2%;
July 2011, 9.0%; and July 2010, 9.5%.
The unemployment rate in construction, however, has now
dipped to only 7.5%. That’s better than June’s 8.2% and last July’s 9.1%. The
worst July figure for construction unemployment was 18.2% in 2009.
The number of jobs in construction rose by 22,000 in the
latest month. That’s a decent increase, but we’re still awaiting a break-out
month. January 2014’s +51,000 figure remains the strongest for this sub-sector
since the recession.
U.S. housing starts are on the mend, although at an almost
glacier-like pace. Encouragement should also be taken from Reed Construction
Data’s non-residential starts figures. In June of this year, they were up by
one-third in dollar volume terms versus May, which was still a large increase
after taking into account the usual seasonality factor (+4.5%).
As they have been throughout the last couple of years,
“professional and business services (+47,000)” and “leisure and hospitality (+21,000)”
were two of the sub-sectors recording substantial increases in staffing in
July.
Retail trade and manufacturing were also employment leaders,
almost exactly matching each other in new hires, +27,000 and +28,000
respectively.
The public sector added 11,000 jobs, with Washington (0.0)
and the states (-1,000) essentially flat, while local administrations (+12,000)
accounted for all the increase.
Source: Reed
Construction Data
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