Positive Reports On Jobs

http://www.nytimes.com/2012/07/06/business/economy/positive-reports-on-us-jobs.html?_r=1&ref=business

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"It takes two to speak the truth: one to speak and one to hear." (Henry David Thoreau)
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So, the NY Times reports this morning that: "The number of people seeking unemployment aid in the U.S. fell last week to its lowest level since mid-May, suggesting layoffs are easing and hiring could pick up."

They also reported that the "four-week average" (for unemployment applications), which smooths out weekly fluctuations, dipped 1,500 to 385,750. And that, when weekly benefit applications consistently fall below 375,000 "... it generally suggests hiring is strong enough to reduce the unemployment rate."

That's the good news. The Times also pointed out that the manufacturing sector contracted for the first time in three years based on data from the Institute for Supply Management which was reported on Monday. That's a closely watched statistic that I've referred to before here.

The Times also pointed out that "...consumer confidence fell for the fourth straight month based on June figures." To me, that's counter-intuitive to lower gas prices (which are always rising at this time of year) and improved housing market figures.

But, this is short term data. Elsewhere, there's a headline in today's Dallas Morning News business section: "Experts See High Jobless Rates Lasting Years." It basically refers to the fact that economists in the latest Associated Press Economy Survey expect the national unemployment rate to stay above 6% - the upper bounds of what's considered healthy - for at least four more years: "If the economists are correct, the job market will still be unhealthy seven years after the recession officially ended in June, 2009. That would be the longest stretch of high unemployment since the end of World War II."

Further: "Those in the survey expect unemployment to still be 8% on Election Day, and a majority predict it won't fall into normal range until 2015, or later."

This group opinion would be hard to argue with unless something were to happen that stimulated GDP growth more than what is currently anticipated.