I'm pleased to note that the level of new jobless claims is at its lowest point in five months. For the first time since February, new unemployment claims were slightly below the 400,000 mark signaling a weak job market. And even this story noted that the news isn't all good.
Which simply means, of course, that businesses are no longer laying pople off as fast as they were several weeks ago, and that the job market isn't quite as weak as it was last week. There's little to indicate, as the story points out, that US businesses are poised to go on the unprecedented orgy of hiring needed to wipe out the 3.5 million job net loss on Bush's watch.
For the work week ending July 19, new applications for unemployment insurance dropped by a seasonally adjusted 29,000 to 386,000, the Labor Department reported Thursday. It marked the second week in a row that claims went down and represented the first time since the week ending Feb. 8 that claims dipped below 400,000, a level associated with a weak job market.
The claims figures were better than economists were expecting; they were forecasting claims to rise slightly.
Although claims tend to swing widely in July, distorted by temporary plant closings, other figures in the report also suggested that the pace of layoffs is stabilizing.
The more stable, four-week moving average of jobless claims, which smoothes out weekly fluctuations, fell by a solid 5,500 last week to 419,250, the lowest level since the work week ending March 8.
And the number of unemployed Americans collecting jobless benefits for more than a week declined by 24,000 to a three-month low of 3.6 million for the work week ending July 12, the most recent period for which that information is available.
While the most recent snapshot of the labor market was encouraging, economists say that even if companies slow the speed at which they lay off workers, they probably won't be in a mood to go on a hiring spree.
Companies — wanting profits to improve — are still reluctant to make big capital spending investments and increase their work forces, the biggest factors restraining the economy's ability to get back to full throttle.
...Even if the economy picks up momentum in the second half of this year, the nation's jobless rate, now at a nine-year high of 6.4 percent, could hover in that range or creep higher in coming months, economists say. Job growth probably won't be strong enough to accommodate all the additional job seekers who would enter the market, attracted by an improved climate.
Consumers are the main force keeping the economy going.
Throughout the economic slump, low mortgage rates, a refinancing frenzy and solid appreciation in home values over the past few years have spurred consumer spending, helping to offset the potentially negative force of a stagnant job market.
However, in recent weeks, mortgage rates have climbed, slowing refinancing activity a bit. A steady upward swing in mortgage rates could dampen — but not derail — the recovery, say economists who are keeping a close eye on the matter.
Unfortunately, the unemployment rate isn't the only thing at a new low point...so is consumer confidence.
Overall consumer confidence in the United States leveled off last week, but remains on pace for its worst annual performance in a decade, according to a survey released Wednesday.
The ABC News/Money Magazine consumer poll found that 28 percent of respondents expressed confidence in the economy, up from 27 percent the week before.
But 52 percent of those polled said their own finances were in good standing, down from 54 percent in the prior week. In assessing respondents' willingness to spend money, 39 percent said it was good, up from 37 percent a week earlier.
Compared with a week earlier, the consumer comfort index, which combines all three responses, held steady at negative-21 points for the week ended July 20.
How much more obvious does it need to be that Bush's crackpot supply-side policies are exactly the wrong thing for the American economy? The productivity gains caused by massive downsizing are way above economic growth, as Brad De Long points out, so companies have no incentive at all to hire -- demand still is nowhere close to their present ability to supply. The weak labor market resulting from Bush's lame economic policies a gold mine for his corporate cronies, but it's no exaggeration to say that the American worker -- including most of the middle class -- gets the shaft.