Friday Economic Snapshot: Failing to meet expectations
Judging by the stock market’s somewhat shaky performance, the first week of June 2013 has been a downer for the American consumers and businesses, as several economic indicators have come in below expectations ahead of the big payroll report coming out later today.
Summing it up, this week we have seen ADP reporting the addition of 135,000 private sector jobs to the American economy, a figure that’s well below the expected 171,000 jobs. Initial claims for unemployment were 346,000, a decrease of 11,000 from the previous week’s revised figure of 357,000 — fairly uneventful. Auto sales figures regained their early-2013 luster, putting a silver lining on the week’s economic news.
ADP Employment Report
Not the numbers anybody was hoping for, the lower jobs numbers reported in the May ADP National Employment Report showed the majority of new jobs came from the service sector, which added a total of 138,000 jobs.
By industry, construction was up 5,000 jobs, while manufacturing fell 6,000. In the positive category, trade/transportation/utilities increased 31,000, financial activities added 7,000 and the professional/business services category added 42,000 jobs. As part of the report, April’s job gains were revised downward to 113,000 from 119,000.
It’s never good to see the goods-producing sector shed jobs. However, the numbers are well within the range of what’s been happening in the previous 12 months.
U.S. Jobless Claims
The number of Americans applying for unemployment assistance dropped this week to 346,000, which is 11,000 lower than last week’s revised figure of 357,000. Zooming out to the four-week average of 352,500, that’s an increase of 4,500 from the previous average. It’s disappointing — as the economy was looking hot for the last few weeks — but in line with more recent, cooler data.
Looking back a year, the weekly number was 378,000, which is markedly worse that our current situation. And, back then, the four-week moving average was 376,000 — so May 2012 wasn’t an outlier. So we have that going for us…
May Vehicle Sales
If 2012-2013 is an indication, look to auto sales whenever other economic data begins to soften to feel a wave of relief. Continuing to move up, up and away, American auto sales are at a seasonally adjusted rate of 15.3 million, up from April’s 14.0 million. The actual sales figure for light vehicles in May was 1,442,311, which is the best monthly volume for May in six years.
General Motors reported its monthly sales in May jumped 3.1 percent, its highly monthly sales since September 2008, an important milestone for the industry bellwether. Ford was up a very healthy 14.1 percent, while Chrysler’s sales improved 11 percent.
Pay attention to the media for the upcoming U.S. payroll data, which will be the most newsworthy economic news of the week. That aside, this 19th week of 2013 has delivered mostly middling results.
Hopefully as spring segues into summer, you and your business have better news to report. After all, small business hiring has been looking pretty good and the marine industry in general is feeling optimistic.