Nothing is Perfect: Job Growth Continues Under Trump Despite Rising Political Pressures.
Damned if you do – damned if you don’t. In life, there is no absolute black or white, (other than birth and death) just shades of grey. The US economy added 201,000 jobs in August, in line with the trend of the past year. Whereas we have seen a strong acceleration in GDP growth over the past two years, from about 1.5 percent to about 3.5 percent, employment growth barely accelerated at all. That means that the long-awaited improvement in productivity growth has finally arrived, at least for now.
Still, the current employment growth is more than enough to continue tightening the labor market. We expect economic growth to remain strong in the coming year, leading to more of the same: solid employment growth that will continue to tighten the labor market and draw more people back into the labor force. Growing labor market tightness will increase recruiting difficulties, labor turnover and compensation. The 12-month growth in average hourly earnings accelerated to 2.9 percent, the highest in this expansion, but still below the pre-recession rates. Labor market tightness varies significantly across occupations and geographies. Supply constraints are more visible in blue-collar occupations, where we are observing faster wage growth. We also anticipate this to provide a further incentive to businesses to raise productivity.
Further, from the White House:
oday’s jobs report continues America’s economic winning streak under President Donald J. Trump, evidenced by strong job creation, rising wages, rapid business growth, and soaring confidence.
THE WASHINGTON POST: U.S. Economy Adds 201,000 Jobs in August as Strong Hiring Continues
“The U.S. economy added jobs for the 95th straight month in August, a record-setting streak. The nation added a robust 201,000 jobs in August, the Labor Department reported Friday, and the national unemployment rate remained at 3.9 percent, one of the lowest levels in half a century.”
FINANCIAL TIMES: US Wages Grow at Fastest Pace in Nine Years
“US wages rose at their quickest pace in nine years in August as the latest labour market data also revealed the economy added more jobs than Wall Street forecast. The latest non-farm payrolls data continue to cast the US economy – which in the June quarter grew at its fastest pace in nearly four years – in a positive light…”
THE WALL STREET JOURNAL: Layoffs Just Reached a Half-Century Low
“Initial jobless claims, a proxy for layoffs across the U.S., declined to a seasonally adjusted 203,000 in the last week of August, the Labor Department said Thursday. This is the lowest level of unemployment benefit applications since the end of 1969. Though data can be volatile from week to week, the four-week moving average of claims, a steadier measure, also fell to a 49-year low, signaling overwhelming tightness in the U.S. labor market.”
REUTERS: U.S. Second-Quarter GDP Growth Raised to 4.2 Percent
“U.S. economic growth was a bit stronger than initially thought in the second quarter, notching its best performance in nearly four years and putting the economy on track to hit the Trump administration’s goal of 3 percent annual growth.”
THE ASSOCIATED PRESS: US Services Firms Saw Growth Quicken in August
“U.S. services companies grew at a faster pace in August as business activity and new orders rebounded. The Institute for Supply Management said Thursday that its services index rose to 58.5 last month from 55.7 in July. Readings above 50 signal an expanding economy.”
WASHINGTON EXAMINER: Boom Times: 83% Execs Say Business is Better, 76% See More Growth
“Over eight-in-10 executives believe that business is better than it was two years ago, and almost as many expect further growth in the third year of the Trump administration, according to a new survey of decision makers. The Zogby Poll from Zogby Analytics, provided to Secrets Friday, also found that both big and small businesses see the economic climate in great shape.”
MARKETWATCH: American Manufacturers Growing at Fastest Pace in 14 years, ISM finds
“American manufacturers are on a roll: Business conditions surged in August to a 14-year high, according to a survey of industry executives. The Institute for Supply Management said its manufacturing index jumped to a 14-year high of 61.3% last month from 58.1% in July. Economists surveyed by MarketWatch had forecast the index to total 57.9%. Readings over 50% indicate more companies are expanding instead of shrinking.”
THE WALL STREET JOURNAL: Richmond Fed’s Manufacturing Index Jumped in August
“An index measuring manufacturing activity across the central Atlantic region expanded in August, according to a report released Tuesday. The Federal Reserve Bank of Richmond said in a report its composite manufacturing index rose to 24 in August from 20 in July. Economists polled by The Wall Street Journal expected a reading of 17 in August.”
CNBC: Consumer Confidence Pops in August to Highest Level Since October 2000
“Consumer confidence rose in August to its highest level since October 2000, building on July’s solid result. The Conference Board’s index climbed to 133.4 in August, despite expectations from a survey of Reuters’ economists that it would fall to 126.7.”
THE WALL STREET JOURNAL: U.S. Consumer Spending Rose 0.4% in July
“Household spending—or what Americans paid for all goods and services, such as groceries and health care—rose 0.4% in July, the Commerce Department said Thursday. That marked another healthy gain after months of strong growth.”
SOURCE The Conference Board and The White House