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Posts Tagged ‘Labor’

12 Mid-March Economic Nuggets

Thursday, March 17th, 2022

Article source: ConstructConnect

(1) The latest inflation figure for the U.S., from the Bureau of Labor Statistics (BLS), is +7.9%, a several-decades high. It’s the year-over-year percentage change in February’s all-items Consumer Price Index (CPI), for all urban consumers. The ‘core’ rate of inflation, which excludes price-volatile food and energy items, is +6.4% y/y. The fact everyone is being ensnared in the strong price advances is captured by the performance of the CPI sub-category ‘food at home’, which has ballooned to +8.6% y/y.

(2) The price of gasoline in February was +38.0% y/y and that was before the repercussions for oil markets from Russia’s invasion of Ukraine made their way to the pump. In early March, West Texas Intermediate (WTI) crude crossed above $100 USD per barrel for the first time in eight years, dating back to 2014. Petrol’s price per gallon has risen above $4.50 in some states and it seems unlikely that will prove to be the ceiling.

(3) Some relaxation in the headline inflation rate will eventually come from resolution of the notorious supply chain bottlenecks that have tied up cargo shipments at ports and along transportation routes. Also, there will be an easing in general price inflation, as a corollary of slower economic growth, resulting from the increases in interest rates being implemented by central banks. The Federal Reserve has just upped the target range for its federal funds rate to between 0.25% and 0.50%. The Bank of Canada has lifted its overnight rate to 0.50%.

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Little Meat on the Bones of the August U.S. Jobs Report

Friday, September 3rd, 2021

Article source: ConstructConnect

August’s Employment Situation report from the Bureau of Labor Statistics (BLS) says that the total number of jobs in the U.S. economy rose by +235,000 in the latest month. A gain of nearly a quarter of a million jobs may sound like a lot, but in the grand scheme of things, it’s rather tame.

Compare it with the month prior’s performance. July was originally reported at +943,000 jobs. That figure has now been revised higher to +1.053 million.

Job creation in August became bogged down. It was probably due to the coronavirus making a comeback, by way of the Delta variant, and threatening a fourth wave heading into the Fall.

The best illustration of how hiring tapped out in August can be found in the ‘leisure and hospitality’ sector. The economy-wide staffing change with bars and restaurants and hotels/motels in the latest month was zero.

Nevertheless, it’s encouraging to note that the year over year change in ‘leisure and hospitality’ employment is a strong +17.4%.

Total employment is now +4.3% y/y; construction employment is +2.7%.

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Construction Left Out of June’s U.S. Big Jobs Advance

Tuesday, July 6th, 2021

Article source: ConstructConnect

June was an excellent month for overall net jobs creation in the U.S., according to the Bureau of Labor Statistics (BLS). Total employment in the nation rose by +850,000 positions.

The construction sector, however, was left out of the bonanza. Staffing among the ‘hard hat’ contingent contracted by -7,000 jobs. The major plus and minus employment shifts within construction occurred with residential specialty contractors (i.e., sub-contractors), +13,000 jobs; nonresidential specialty contractors, -15,000 jobs; and heavy and civil general contractors, -11,000 jobs.

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U.S. Half Million Jobs Increase in May still only Drop in Bucket

Friday, June 4th, 2021

Big Grin Greets Big Pickup in Youth Employment

In any pre-pandemic month, May’s U.S. total jobs count gain of +559,000 would have registered as outstanding. And I don’t want to belittle the achievement, especially since it soundly beats the previous month’s figure of +278,000.

But as can be seen from Graph 1, even a swing of plus more than half a million appears as only a blip in the context of the month-to-month movements over the past year and a quarter.

The seasonally adjusted (SA) unemployment rate in May improved to 5.8% from 6.1% in April. The not seasonally adjusted (NSA) unemployment rate downshifted to 5.5% from 5.7% the month previously.

Young people are finding employment once again. The SA unemployment rate for individuals aged 16 to 19 brightened to 9.5%. And yes, ‘brightened to 9.5%’ is appropriate wording given that a year ago the SA unemployment rate for those just under aged 20 was 30.7%.

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Mid-May Economic Nuggets Report with Focus on Retail Sales, Inflation and Housing Starts

Wednesday, May 19th, 2021

Article source: ConstructConnect

In this, the latest mid-month Nuggets report, I’ll focus on three major and interlocking (or interdependent) economic indicators: retail sales, inflation and housing starts.

Retail Sales

My world of economic analysis is being rocked in unprecedented fashion. Maybe ‘shattered’ is the better word.

For example, I’m used to studying year-over-year percentage changes to gain an understanding of what is going on in certain segments of the economy. Retail sales is a perfect example. In current dollar terms (i.e., not adjusted for inflation), they used to range from flat as a lower boundary to maybe +7% y/y as an upper limit.

When the coronavirus first struck in the Spring of last year, retail sales plummeted, yielding double-digit percentage-change drops for ‘total’ and many shopkeeper sub-categories. Now, a year later, the rebound that’s underway is being vastly exaggerated by the comparison with 2020’s deeply distressed results. Looking at April 2021/April 2020, we’re dealing with ‘funhouse’ numbers on the upside.

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U.S. October Jobs Growth Not as Underwhelming as First Appears

Tuesday, November 5th, 2019

Revisions to Past Data Paint Better Picture

The headline figure on U.S. net jobs creation in October, as recorded in the latest Bureau of Labor Statistics (BLS)’s Employment Situation report, was a rather tepid +128,000. But as has occurred on several other recent occasions, there were significant revisions to past data that brighten the picture considerably.

U.S. October Jobs Growth not as Underwhelming as First Appears GraphicA month ago, September’s total employment count was reported as 151.722 million. Now, September is being estimated at 151.817 million, or +95,000. Therefore, October’s jobs number of 151.945 million is +223,000 when compared with what was originally reported for the prior period.

Nevertheless, there has been a deceleration in U.S. jobs growth this year. The monthly average increase in employment through the first three quarters of 2018 was +226,000. From January through September of 2019, the monthly average gain has been +167,000, a reduction of one-quarter (-26.0%).

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13 Yellow Flags ‒ Warning Signs Concerning the U.S. Economy

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.

13 Yellow Flags ‒ Warning Signs Concerning the U.S. Economy Graphic

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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May’s Weakening in U.S. Jobs Growth and the Inverted Yield Curve

Thursday, June 13th, 2019

U.S. Jobs +75,000 in May, but Flat After Revisions

Article source: ConstructConnect

The latest Employment Situation report from the Bureau of Labor Statistics (BLS) records a gain of +75,000 in total U.S. jobs in May. The +75,000 month-to-month increase was the second lowest so far this year. February’s figure was worse at +56,000.

May’s Weakening in U.S. Jobs Growth and the Inverted Yield Curve Graphic

What’s hidden, however, unless one digs a little deeper, is the fact that total U.S. employment in May really didn’t increase at all. The total jobs number now being reported for May, at 151.095 million, is the same as the total jobs number that was published a month ago for April. The explanation lies in the fact that April’s number has been revised down by -75,000.

The national unemployment rate in May stayed extremely tight, at 3.6%, the same as in the previous April. The participation rate likewise remained steady, at 62.8%.

The composition of May’s +75,000 jobs performance was an interesting combination of only +8,000 in goods production, +82,000 in the private services-providing sector and -15,000 with government. The public sector’s jobs loss was at the state (-10,000) and local (-9,000) levels, as Washington made a minor upwards staffing adjustment (+4,000).

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A Chill in U.S. February Employment Numbers, Canada’s Performance Perkier

Friday, March 8th, 2019

Article source: ConstructConnect

February’s Employment Situation report from the Bureau of Labor Statistics delivered the kind of U.S. total employment change, month to month, that we have become unaccustomed to seeing. Net jobs growth was quite weak, at only +20,000. It’s been 17 months since the figure was comparably low, +18,000 in September 2017.

A Chill in U.S. February Employment Numbers; Canada’s Performance Perkier Graphic

Over the last several years, the month-to-month jobs gain has usually been at least +175,000, often exceeding +200,000. In the first month of this year, January, it was +311,000.

On the brighter side, the unemployment rate in the latest month improved to 3.8% from 4.0% in the prior period.

There was only one major industrial sector with a substantial pick-up in nominal number of jobs in January, ‘professional and business services,’ +42,000. The staffing increases were evenly and widely spread among segments of the sector (e.g., accounting, design, computer, and help-wanted services).

‘Education and health services’ added just 4,000 jobs, but that was because education services declined by -19,000 jobs. ‘Health care and social assistance’ wasn’t shy about hiring, lifting its combined payroll by +23,000.

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Ramifications of U.S. Shutdown Ripple outwards to China and Canada

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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