Posts Tagged ‘Economics’
Friday, May 8th, 2020
Article source: ConstructConnect
Unemployment Rate at 14.7% could have been Worse
It could have been worse. I thought it would be worse. Next month’s figure will probably be worse.
I’m speaking of April’s U.S. seasonally adjusted (SA) unemployment rate, as calculated by the Bureau of Labor Statistics (BLS). It came in at 14.7%, after being just 4.4% in March.
If you’re looking for a figure that’s jaw-dropping, turn to the total number of jobs in the country. From March to April, there was a decline of 20.5 million.
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Tags: Alex Carrick, Canada, construct, Construction, Construction industry, coronavirus, COVID-19, Economic, Economics, Economist, job, jobless, jobs, money, recovery, residential, shareknowledge, US
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Monday, September 30th, 2019
Article source: ConstructConnect
The U.S. economic recovery and expansion has now lasted more than a decade, which is historically ‘long in the tooth.’ With each passing month, and despite how well the major stock market indices may be doing, worries about a slowdown or next recession become harder to suppress.
The following are some of the yellow flags pointing to potholes in the road ahead. When warranted, countervailing positives have been added.
(1) Running Out of Track for the Stimulus Train
At present, it’s the absence of something special to look forward to that is significant. Heading into 2018, executives throughout the U.S. were eagerly anticipating the steep cut in the corporate tax rate, from 35% to 21%, and several other business-friendly initiatives (i.e., incentives to repatriate money from overseas, etc.). There’s nothing implying a similar upbeat impact on the horizon today.
The Trump administration has floated the idea of a big middle-class income tax cut. A formidable stumbling block, however, has emerged. The estimated federal deficit in the current fiscal year, made worse by the corporate tax cut, will reach -$1 trillion. Washington’s total debt is -$22 trillion and climbing. Personal income tax relief would most likely further exacerbate an already troubling situation.
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Tags: Alex Carrick, brexit, capex, Deficit, Economic, Economics, Economist, Economy, geopolitical, interest rate, jobs, Labor, population drop, stimulus, Weather
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Tuesday, August 6th, 2019
Article source: ConstructConnect
Fed Becomes Erratic in Response to Unorthodox Economic Policy
After achieving +3.1% GDP growth in Q1, the U.S. economy stayed healthy in Q2 at +2.1%. In July, according to the latest ‘Employment Situation’ report from the Bureau of Labor Statistics (BLS), +164,000 net jobs were created in America, on top of a +193,000 gain the month before.
The unemployment rate continues to sit at an exceptionally low 3.7%. Inflation is a little less than +2.0% year over year. All in all, the U.S. economy is in extraordinarily good shape.
How is the Federal Reserve responding? It just lowered its key policy-setting interest rate by 25 basis points (100 bps = 1.00%). It has also suggested that further cuts are no sure thing.
Orthodox economic policy would see a strong U.S. economy raising other economies around the world. Orthodox policy would permit relatively free ‘goods’ flows internationally, resulting in better global trade and heightened demand for commodities. A ‘rising tide would lift all boats’.
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Tags: Alex Carrick, ConstructConnect, Economic, Economic policy, Economics, Economist, Economy, Growth
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Friday, February 22nd, 2019
Article source: ConstructConnect
This article is the seventh, or final one, in a series of seven that examines key industrial sectors to determine where they are most significant regionally. Rankings of state strength in each industrial sub-sector are based on both ‘weight’ and ‘concentration’ of relevant employment.
‘Weight’ is simply the number of jobs in the industrial sub-sector in each state. ‘Concentration’ is each state’s number of jobs in the sub-sector divided by the state’s population. In effect, it’s a ‘per capita’ figure, except that it’s expressed as number of jobs per million population.
By ‘weight’, the states with the largest populations are almost always high in the rankings. The rankings by ‘concentration’, however, often expose some unexpected winners.
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Tags: Alex Carrick, ConstructConnect, Economic, Economics, Growth, home, Housing, interest rate, job, money
Comments Off on Series (7 of 7): Rankings of States by Industrial Sub-Sector Jobs – Construction
Friday, January 25th, 2019
Article source: ConstructConnect
U.S. Census Bureau workers are off the job due to Washington’s partial funding shutdown. As a result, current statistics on housing starts, retail purchases and foreign trade are not available.
This is no minor matter. It will be difficult to accurately calculate national output – i.e., the important gross domestic product (GDP) measure – without reliable data on many of its key components. GDP growth, or lack thereof, is one key determinant of Federal Reserve interest rate moves. The Fed will struggle over whether to be ‘hawkish’, ‘dovish’, or stick with neutral.
Furthermore, the ramifications of economic data omissions are not solely limited to the U.S.
The U.S. and China are engaged in a trade skirmish, with tariffs on Chinese goods entering the U.S. slated to increase to 25% from 10% at the end of March, if there is no resolution. The U.S. has been running a huge trade deficit with China for years. In many months, it has been in a range of 40% to 50% of the total U.S. merchandise trade shortfall with all nations.
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Tags: Alex Carrick, ConstructConnect, Economics, Economist, Economy, election, employ, employment, Growth, home, house, Housing, job, jobless, Labor, market, material, money, real estate, residential, shutdown, US
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Wednesday, January 16th, 2019
Article source: ConstructConnect
Construction spending in various type-of structure categories is driven by economic circumstances within specific industrial subsectors. For example, manufacturers set the pace in industrial construction.
Good health in the leisure and hospitality sector provides the backing for new hotel and motel work. And jobs levels in information and financial services, as well as in more rapidly expanding fields of endeavor such as computer systems and design services, establish the need for additional office space and commercial tower square footage. (See, “Shifts in Office Jobs and Implications for Commercial Tower Construction.”)
This article is the second in a series of seven that examines key industrial sectors to determine where they are most prominent regionally. Rankings of state strength in each industrial subsector are based on both ‘weight’ and ‘concentration’ of relevant employment. ‘Weight’ is simply the number of jobs in the industrial subsector in each state. ‘Concentration’ is each state’s number of jobs in the subsector divided by the state’s population. In effect, it’s a ‘per capita’ figure, except that it’s expressed as number of jobs per million population.
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Tags: Alex Carrick, ConstructConnect, Construction industry, Economic, Economics, Economist, employment, house, Housing, job, jobless, jobs, Labor, market, material, money
Comments Off on Series (2 of 7): Rankings of States by Industrial Subsector Jobs – Financial Services
Thursday, January 10th, 2019
Article source: ConstructConnect
The dollar volume of ConstructConnect’s ‘grand total’ construction starts in full-year 2018 was -5.0% compared with full-year 2017. The percentage change for nonresidential work was -2.0%.
How significant were the largest project initiations in those overall percentage changes? Each month, to update clients on showcase project activity, ConstructConnect publishes a Top 10 groundbreakings list. The summation of the Top 10 projects for every month in 2018 (i.e., 120 projects in total) was $85.4 billion, +1.3% versus 2017’s comparable figure of $84.2 billion.
Many of 2018’s biggest project starts are set out in two accompanying infographics and tables. While there were other type-of-structure categories with multiple extra-large projects last year, six that stood out were: high-tech data and fulfilment centers; hotels and conference centers; bridges; manufacturing and distribution centers; medical facilities; and law enforcement.
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Tags: Alex Carrick, ConstructConnect, Construction services, Economic, Economics, Economist, Economy, employ, Growth, Housing, job, jobless, Labor, market
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Tuesday, January 8th, 2019
Article source: ConstructConnect
The total number of jobs in the U.S. rose by +312,000 in December, according to the latest Employment Situation report from the Bureau of Labor Statistics (BLS).
There was only one other month in 2018 with a greater surge in jobs creation, February at +324,000.
Optimism over hiring prospects caused the participation rate in December to climb to 63.1% from 62.9% the month previously (i.e., more out-of-work individuals decided to rejoin the labor force). The side effect was that the unemployment rate moved up to 3.9% from 3.7% in November.
The large month-to-month gain in jobs in December understates the overall improvement, since there was also a substantial positive revision to prior data. A month ago, the BLS reported a total jobs level of 149.893 million. It is now saying that November’s figure was really 149.951 million, an increase of +58,000.
Therefore, December’s just-reported level of 150.263 million exceeds November’s first-reported level of 149.893 million by +370,000 jobs.
By industry sector, the largest revisions to November’s jobs statistics came from ‘retail’ (+18,000), ‘government’ (+16,000) and ‘leisure and hospitality’ (+14,000).
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Tags: Alex Carrick, build, Canada, CMD, ConstructConnect, Construction, Construction services, Economic, Economics, Economist, jobs, Labor, manufacturing, market, money
Comments Off on December Jobs Reports: U.S. Ends 2018 with Bang; Canada with Whimper
Monday, December 17th, 2018
Article source: ConstructConnect
The tail that is attempting to wag the dog these days is the stock market. With only two weeks remaining in 2018, America’s major stock market indices have moved, at best, sideways versus close-of-year 2017. The Dow Jones Industrial Index (DJI) is currently -0.5% relative to its closing level on December 31 of last year. The S&P 500 is -0.9% and NASDAQ, -2.4%.
North of the border, the Toronto Stock Exchange is -9.0% compared with year-end 2017.
The FANG stocks have been leading the retreat in equity prices. Since the summer of this year, the share price of Facebook, which has experienced confidentiality problems galore, is -29.2%; Amazon, the retail sector’s ‘disruptor-in-chief’, is -19.9%; Netflix is -34.1%; and Google/Alphabet, -16.2%. Even Apple has moved out of favor, -26.3%. On August 2nd, Apple became the world’s first trillion-dollar company, but of course that valuation no longer stands.
The Federal Reserve has been paying attention. Earlier, the Chairman of the Fed was adamant that he wanted to see the federal funds rate return to its ‘equilibrium’ or neutral level of 3.00%. Neutrality is when prevailing interest rates are neither too stimulatory nor too contractionary.
The current level of the federal funds rate is in a range of 2.00% to 2.25%. The likelihood is still high there will be another 25 basis-point (where 100 basis points equals 1.00%) increase later in this month of December. The schedule for next year, however, is no longer as firmly established. Fed Chairman, Jerome Powell, has stated that future action on interest rates will be ‘data driven’.
By the way, the stock markets also really don’t like the tariff skirmish with China. Whenever there is even a hint of a resolution of that dispute, investors respond ecstatically.
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Tags: Alex Carrick, build, Canada, ConstructConnect, Construction industry, Construction services, Economic, Economics, Economist, Growth, home, US
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Thursday, December 13th, 2018
Article source: ConstructConnect
ConstructConnect announced today that November’s volume of construction starts, excluding residential work, was $27.4 billion, the lowest level since February ($26.6 billion) of this year.
On a month-to-month basis, November’s nonresidential starts fell by nearly one-quarter (-22.6%). The usual seasonal pullback, due to harsher winter-onset weather, is in a range of -2% to -7%. November 2018 compared with November 2017 was -9.8%. November 2018 relative to the previous five-year average for November, − i.e., from 2013 through 2017, − was +0.9%.
Year-to-date starts in 2018 compared with January-to-November of 2017 have been -4.0%. There is only one month still to go, December, before 2018’s annual results will be tabulated.
The starts figures throughout this report are not seasonally adjusted (NSA). Nor are they altered for inflation. They are expressed in what are termed ‘current’ as opposed to ‘constant’ dollars.
View this information as an infographic.
‘Nonresidential building’ plus ‘engineering/civil’ work accounts for a larger share of total construction than residential activity. The former’s combined proportion of total put-in-place construction in the Census Bureau’s October report was 59%; the latter’s was 41%.
ConstructConnect’s construction starts are leading indicators for the Census Bureau’s capital investment or put-in-place series. Also, the reporting period for starts (i.e., November 2018) is one month ahead of the reporting period for the investment series (i.e., October 2018.)
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Tags: Alex Carrick, build, commercial, construct, ConstructConnect, Construction, Construction industry, Construction services, Economic, Economics, Economist, Economy, job, non-residential
Comments Off on Rough Patch for Nonresidential Starts in November, But YTD Decline Remained Modest
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