adios
08-06-2004, 11:05 AM
To me this wasn't a big surprise and I know a lot of others it wasn't a surprise to either. FWIW the price of gasoline at the pump and what I consider impediments to businesses hiring are putting a damper on hiring in the U.S. The price of gasoline has a dampening effect on economic growth and the costs of taking on new employees in the U.S. are high. Kerry should be the favorite to win the election. Like it or not he's the defacto candidate of hope. I saw today that Kerry is going to unveil a $30 billion energy program with lot's of money directed at research and a $5000 tax break to consummers who buy fuel effecient autos such as hybrids. Very little of it has a chance to see the light of day if he gets elected however IMO.
Employment Growth Surprisingly Weak (http://story.news.yahoo.com/news?tmpl=story&cid=568&ncid=749&e=1&u=/nm/20040806/bs_nm/economy_dc)
Employment Growth Surprisingly Weak
1 hour, 14 minutes ago Add Business - Reuters to My Yahoo!
By Tim Ahmann
WASHINGTON (Reuters) - U.S. employers added a paltry 32,000 workers to payrolls last month, the government said on Friday in a report that was far weaker than expected and unwelcome news for an election-bound President Bush (news - web sites).
The Labor Department (news - web sites) also cut its tally of job growth in May and June by a combined 61,000, adding to the report's weak tenor.
Bond markets surged and the dollar tumbled as the data raised questions about how successfully the economy shook off June weakness and led financial market participants to expect a slower pace of interest-rate rises from the Federal Reserve (news - web sites) than had been expected.
In one bright spot, the unemployment rate fell to 5.5 percent last month from 5.6 percent in June as a separate Labor Department survey of households showed robust employment growth. The department cautioned, however, that the household survey was a less reliable barometer of month-to-month changes in employment than its larger survey of businesses.
Wall Street economists polled last week had looked for a payroll gain of 228,000, although a weak employment reading from a service sector survey on Wednesday had some bracing for a weaker number. Still, they were stunned by July's lackluster figure.
"It's a huge disappointment, a big surprise," said Scott Brown, chief economist at Raymond James in St. Petersburg, Fla. "It implies a very sharp revision to the overall outlook for the economy."
The Bush administration was likely to look on the positive side as the report showed 1.5 million jobs have been created in 11 straight months of hiring gains.
However, Democratic White House hopeful John Kerry (news - web sites) could accurately argue that the economy is still down 1.1 million jobs since Bush took office, despite the recent gains.
Fed officials gather next Tuesday to plot interest rate strategy and had widely been expected to add to a quarter-point interest-rate increase made in June.
Some economists said the Fed would still raise rates next week but may have second thoughts at its next meeting in September, unless it was clear by then that the economy had regained momentum.
"We still think that the Fed will raise rates next week, but the case for moving slowly and deliberately is strengthened by this report," said Patrick Fearon, an economist at A.G. Edwards and Sons in St. Louis.
The government said last week the economy advanced at just a 3 percent annual rate in the second quarter, a sharp slowdown from its heady 4.5 percent first-quarter pace, but fresher data had led many to think the pace of growth quickened last month.
Manufacturers added a meager 10,000 workers in July, after cutting a revised 1,000 from their payrolls in June. The department noted a loss of 21,000 jobs in the transport industry, which it pinned on larger-than-usual retooling shutdowns at auto plants.
Construction firms added just 4,000 new workers.
The service side of the economy showed weakness as well, creating only 14,000 new jobs. Employment at financial firms plummeted, with big losses at mortgage brokers that some economists said could be tied to rising interest rates.
Employment Growth Surprisingly Weak (http://story.news.yahoo.com/news?tmpl=story&cid=568&ncid=749&e=1&u=/nm/20040806/bs_nm/economy_dc)
Employment Growth Surprisingly Weak
1 hour, 14 minutes ago Add Business - Reuters to My Yahoo!
By Tim Ahmann
WASHINGTON (Reuters) - U.S. employers added a paltry 32,000 workers to payrolls last month, the government said on Friday in a report that was far weaker than expected and unwelcome news for an election-bound President Bush (news - web sites).
The Labor Department (news - web sites) also cut its tally of job growth in May and June by a combined 61,000, adding to the report's weak tenor.
Bond markets surged and the dollar tumbled as the data raised questions about how successfully the economy shook off June weakness and led financial market participants to expect a slower pace of interest-rate rises from the Federal Reserve (news - web sites) than had been expected.
In one bright spot, the unemployment rate fell to 5.5 percent last month from 5.6 percent in June as a separate Labor Department survey of households showed robust employment growth. The department cautioned, however, that the household survey was a less reliable barometer of month-to-month changes in employment than its larger survey of businesses.
Wall Street economists polled last week had looked for a payroll gain of 228,000, although a weak employment reading from a service sector survey on Wednesday had some bracing for a weaker number. Still, they were stunned by July's lackluster figure.
"It's a huge disappointment, a big surprise," said Scott Brown, chief economist at Raymond James in St. Petersburg, Fla. "It implies a very sharp revision to the overall outlook for the economy."
The Bush administration was likely to look on the positive side as the report showed 1.5 million jobs have been created in 11 straight months of hiring gains.
However, Democratic White House hopeful John Kerry (news - web sites) could accurately argue that the economy is still down 1.1 million jobs since Bush took office, despite the recent gains.
Fed officials gather next Tuesday to plot interest rate strategy and had widely been expected to add to a quarter-point interest-rate increase made in June.
Some economists said the Fed would still raise rates next week but may have second thoughts at its next meeting in September, unless it was clear by then that the economy had regained momentum.
"We still think that the Fed will raise rates next week, but the case for moving slowly and deliberately is strengthened by this report," said Patrick Fearon, an economist at A.G. Edwards and Sons in St. Louis.
The government said last week the economy advanced at just a 3 percent annual rate in the second quarter, a sharp slowdown from its heady 4.5 percent first-quarter pace, but fresher data had led many to think the pace of growth quickened last month.
Manufacturers added a meager 10,000 workers in July, after cutting a revised 1,000 from their payrolls in June. The department noted a loss of 21,000 jobs in the transport industry, which it pinned on larger-than-usual retooling shutdowns at auto plants.
Construction firms added just 4,000 new workers.
The service side of the economy showed weakness as well, creating only 14,000 new jobs. Employment at financial firms plummeted, with big losses at mortgage brokers that some economists said could be tied to rising interest rates.