Looks like you're wrong again, Kenneth...
Manufacturing, Hiring Picked Up in July: U.S. Economy Preview
Aug. 1 (Bloomberg) -- The U.S. economy began to accelerate again in July after a second-quarter lull, numbers on manufacturing and employment may show this week.
The Institute for Supply Management is likely to report tomorrow that its factory index for last month rose to 62 from 61.1 in June, according to the median estimate in a Bloomberg News survey of economists. Readings higher than 50 signal growth.
Consumer spending grew from April through June at the slowest pace since the 2001 recession. For consumers to provide more octane to the economy, companies need to step up hiring. They did just that in July, economists say. About 247,000 jobs were probably created, more than twice as many as in June, the Labor Department is expected to report Friday.
``Things are definitely recovering,'' said William Dudley, chief U.S. economist at Goldman, Sachs & Co. in New York. ``The weakness in June that got the market's attention is going to turn out to be an anomaly.'' Dudley forecasts that payrolls increased by 300,000 in July.
The unemployment rate probably held at 5.6 percent as more people entered the labor force, according to the survey.
The economy expanded at a 3 percent annual rate in the second quarter, slower than the 4.5 percent pace in the first three months of the year, the Commerce Department said Friday.
Business investment accelerated, giving a boost to factories and supplanting consumer purchases as the main contributor to growth for the first time since early 1995.
Jobs and Spending
How much the economy picks up in the second half of the year depends on whether consumers have enough income to boost their spending, which accounts for two-thirds of gross domestic product. Adding to the 1.3 million jobs already created this year is important, since the benefits of mortgage refinancing have all but disappeared and Americans have spent their tax refunds.
``We've continued to see growth'' in hiring, Andrew J. McKelvey, chief executive officer of Monster Worldwide Inc., said in an interview last week. Monster is the world's most-used Internet site for help-wanted advertising.
U.S. Senator John Kerry, the Massachusetts Democrat campaigning to unseat President George W. Bush in November, has said the jobs that are being created are mostly ``second-rate'' because they don't pay as well as those that have been lost. Payrolls have shrunk by 1.1 million since Bush took office more than three years ago.
``We hear a lot of that, and that's not what we see at all,'' McKelvey said. Federal Reserve Chairman Alan Greenspan told lawmakers on July 21 that the Fed hasn't been able to find ``a significantly meaningful change'' in job quality.
Incomes
Job growth has helped drive up wages and salaries, which increased 7.2 percent at an annual rate from January through May. That's twice as much as last year, the latest figures from the Commerce Department show.
The Fed noted in its ``beige book'' survey of regional economic conditions last week that some employers are having trouble finding workers with the right skills to fill openings.
``Limited occupational shortages were reported in Boston, Cleveland, Chicago, Kansas City and San Francisco,'' the report said. Shortages were noted in trucking, construction, technology services, accounting, biotechnology and manufacturing.
Fuel prices have risen along with incomes, limiting what Americans can spend after filling up their autos. Gasoline prices held above $2 a gallon on average in May and June, with regular unleaded rising 35 percent from the beginning of the year to $2.10 a gallon in mid-May. Prices may be rising again after dropping to less than $2 through July.
Fuel Prices
Crude oil for September delivery reached $43.85 a barrel on the New York Mercantile Exchange, the highest since the contracts began trading in 1983.
July may become the ninth consecutive month with a reading higher than 60 in the factory index. The longest stretch before that was July 1972 through June 1973. The index has exceeded 50 since May 2003.
A report from the Commerce Department on Wednesday is expected to show a 0.5 percent rise in factory orders in June after a 0.3 percent fall in May, according to the median forecast in a Bloomberg survey.
Regional surveys have shown that manufacturing snapped back in July after dropping in June. An index of Chicago-area manufacturers and other businesses rebounded because of more orders, increased production and a rise in backlogs. The index of unfilled orders, a sign of the strength of demand, rose to the highest since July 1994, according to the National Association of Purchasing Management-Chicago.
The Federal Reserve Bank of Philadelphia's index of manufacturing rose to 36.1 from 28.9, and its measure of employment was the highest ever. The New York Fed's Empire State index rose to 36.5 from 29.9, expanding for a 15th month amid increased orders and hiring.
The Institute for Supply Management on Wednesday is also expected to report an increase in its index of services and other non-manufacturing business to 61.8 in July from 59.9.
quote.bloomberg.com
It must really stink to be you.
Diz-
PS: Kenneth, what's your definition of a lie? TIA |
