October 23, 2017

U.S. Adds 165,000 Jobs; Jobless Rate Falls to 7.5%

The latest jobs figures from the Department of Labor paint a brighter picture of the overall economy than other recent data, which had been weaker and prompted economists to warn of a spring swoon for the third year in row. Those worries had been heightened after the March jobs report, which initially showed the economy to have added just 88,000 jobs, much fewer than had been expected.

On Friday, however, the government sharply revised upward its estimates for job creation in February and March, concluding that the economy actually generated 332,000 jobs in February and 138,000 in March. The unemployment rate, which is based on a separate survey, fell by 0.1 percentage point to 7.5 percent, from 7.6 percent in March.

“It’s back to normal for this cycle,” said Steve Blitz, chief economist at ITG. “This number is back to the mainstream of what we’ve seen in this recovery.”

Still, Mr. Blitz noted, many of the new jobs were in lower-paying sectors like retail and food services. Stores hired 30,000 workers, while restaurants added 38,000 employees.

“You’re hiring people, but you’re not generating high-income jobs,” he said. “But work is work. It’s honorable.”

Another positive sign was that the size of the labor force increased, while the total number of unemployed Americans dropped by 83,000 to 11,659,000.

The stock market reacted strongly to the better-than-expected figures, with the Standard Poor’s 500 index breaking through the 1,600-point level for the first time, rising almost 1 percent at the opening bell. The Dow Jones industrial average was up over 130 points, nearly 1 percent as well.

Economists have been warning that the economy — and job creation — will slow in the second-quarter, largely as a result of fiscal tightening in Washington. Payroll taxes increased in January, and across-the-board spending cuts mandated by Congress went into effect in March, and their impact is expected to be felt more broadly in the months ahead.

And while the private sector has clearly been on the upswing this year, the government continues to represent a drag on job creation, shedding 11,000 jobs during the month. Over all, April’s rate of job creation was still well below the 209,000 jobs added per month in the fourth quarter of 2012.

“In one line: Not bad, especially in the light of beaten-down expectations,” said Ian Shepherdson, chief economist with Pantheon Macroconomic Advisors. “This could have been much worse.”

The manufacturing sector, which is closely watched as a gauge of broader economic strength, was unchanged in April. Private sector job creation totaled 176,000.

With the unemployment rate still well above 6.5 percent, the Federal Reserve has promised to keep buying billions of dollars of bonds in an effort to help bolster growth. The Fed’s stimulus efforts have helped buoy the markets, but the job picture has remained weak.

Economists also noted that the number of hours worked fell in April, another sign that the economy is having trouble generating enough additional income and jobs to help lift spending.

The government could be the wild card in the coming months. Automatic, across-the-board spending cuts officially went into effect in March, and if the mandated spending cuts continue, layoffs could increase. Apart from the job figures, the economy has been showing signs of weakness of late. Several indicators beginning in March have pointed to much slower growth, with everything from retail sales to manufacturing looking soft recently.

“What’s the biggest drag on the economy? The government,” said Diane Swonk, chief economist for Mesirow Financial in Chicago. “If the government simply did no harm, we could be at escape velocity.”

Article source: http://www.nytimes.com/2013/05/04/business/economy/us-adds-165000-jobs-in-april.html?partner=rss&emc=rss

Many Cities Face a Long Wait for Jobs to Return

In some regions, those years are in danger of turning into a decade. According to a report to be released Monday, nearly 50 metropolitan regions — or more than one out of seven — are unlikely to bring back all the jobs lost in the recession until after 2020.

Among those areas are Cleveland and Dayton, Ohio; Detroit; Reno, Nev.; and Atlantic City, according to the report commissioned by the United States Conference of Mayors.

Detroit, which lost 323,400 jobs during the recession, and Reno, which lost 36,000 jobs, are not expected to regain all of those positions until after 2021.

With job creation having slowed to a crawl and the housing market depressed by foreclosures and falling prices, the economy is struggling to put 13.9 million unemployed Americans back to work.

According to the mayors’ report, which was compiled by IHS Global Insight, the nation’s 363 metropolitan statistical areas tracked by the Labor Department will generate enough jobs to get back to only the prerecession peak of employment in the first half of 2014, a dreary forecast that poses an increasing political challenge to the Obama administration. The areas lost 7.3 million total jobs during the recession from a peak of 118.3 million in the first quarter of 2008.

The report notes that metro regions account for about 86 percent of all jobs.

“It is striking, it’s sobering and it’s a call to action,” said Antonio R. Villaraigosa, mayor of Los Angeles and the president of the Conference of Mayors. Mr. Villaraigosa suggested that the federal government invest in infrastructure as well as work force training. The mayors’ report projected that the Los Angeles region, which lost 537,100 jobs during the downturn, would not gain them back before 2018.

The forecasts do not account for the number of jobs that need to be created just to account for normal population growth. As a result, said James Diffley, senior director at IHS Global Insight, even when the economy adds back the jobs lost during the recession, the unemployment rate, now at 9.1 percent, is likely to be significantly higher than the 4.4 percent it was before the crisis.

Among the largest metropolitan regions that will have a long road to recovery are manufacturing centers in Ohio and Michigan, where huge waves of layoffs at car plants and other factories affected thousands of workers.

“The type of jobs lost are not easily replaced,” said Lucious Plant, work force development manager in Montgomery County, which includes Dayton and surrounding communities. The region was overwhelmed by thousands of job losses at plants operated by General Motors and the parts supplier Delphi Automotive.

Mr. Plant said that old-line factory workers did not necessarily have the skills for the jobs that are now being added by advanced manufacturers. Dayton, which lost 42,500 jobs — or more than 10 percent of its labor force — during the recession, has had some luck attracting new employers recently, landing a Caterpillar Logistics distribution center that is expected to eventually bring on 600 people. Also, the back-office operations of a law firm added about 200 jobs.

Since losing a job at Delphi in 2008, Josh Hamer has been taking odd jobs repairing computers and is attending community college on government grants to earn an associate’s degree in network management. In the meantime, he has filed hundreds of job applications.

“I want anything that will pay the bills,” said Mr. Hamer, 32. “But they see Delphi and they see me applying for an office job, and they say, ‘You can’t do this job because you’re not qualified for it.’ They see grunt work, and they see a grunt.”

Other regions were hammered by the housing collapse and are having difficulty climbing back. In Naples, Fla., which lost 25,200 jobs during the recession, local economic development officials are focusing on small businesses in the technology and medical device sectors, industries that may not help unemployed construction workers. The mayors’ report projects that the area will get back to its prerecession peak by 2017.

Tammie Nemecek, chief executive of the Economic Development Council of Collier County, Fla., said the region might not recapture all the jobs it lost. “There’s a lot of people saying I want a new economy so we can ensure that there’s sustainability in it,” she said.

The mayors’ report does project faster recovery in some regions, including several metropolitan areas in Texas, as well as Denver; Raleigh, N.C.; and Washington.

Global Insight forecasts that the New York metropolitan region, which lost 385,200 jobs during the recession, will get back to its prerecession peak by 2013, in part because the financial sector did not lose as many jobs as feared. That could change as Wall Street, facing falling markets and an uncertain regulatory climate, plans further cuts to its work force.

Some metropolitan regions disputed the forecasts. In Cleveland, where Global Insight projects a return to peak employment in 2021, Mayor Frank G. Jackson’s chief of staff, Ken Silliman, said that Cleveland’s unemployment rate, 7.6 percent, was the seventh lowest of the metropolitan areas with more than 1.5 million people.

He added that a newly built medical center was “staking out Cleveland as a national leader in medical technology” and that the area would recapture the jobs it lost within three to five years “without a doubt.”

Mr. Diffley of Global Insight said that many regions were trying to brand themselves as leaders in new sectors. “It’s not a zero sum game,” Mr. Diffley said. “But everybody can’t be a leader in the field they’d like to be, by definition.”

Article source: http://feeds.nytimes.com/click.phdo?i=71d37190ea7efb475f405ec975f963b2