Posts Tagged recession

The Great Recession Continues

Posted by Tetyana Matychak in Budget on January 27th, 2010

The December jobs report has doused the hope that we were at the beginning of a sustained economic recovery.

The unemployment rate managed to hold at 10% in December only because of an extraordinary shrinkage in the labor force: Some 661,000 gave up looking for a job.

Bureau of Labor Statistics’ (BLS) nonfarm payroll data indicate that December job losses totaled 85,000. But the bureau’s household survey, a better and more comprehensive measure of both the unemployed and underemployed, indicated a loss of 589,000 jobs. Since the Great Recession began in 2007, some 8.6 million jobs have been lost, according to the bureau; and small businesses, the normal source for new jobs, are still shedding workers. Fewer than 10% added employees, while more than 20% cut back—and the cuts averaged nearly twice as many per firm as the hires at the expanding companies.

Unemployment, in short, has graduated from being a difficulty, a worry. It is now a catastrophe, with some 15.3 million Americans out of work, according to the BLS. Read the rest of this entry »

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Jobless claims show labor market may slow recovery

Posted by Tetyana Matychak in Budget on September 7th, 2009

New claims for jobless aid fell less than expected last week, and the number of people continuing to receive unemployment benefits rose - further signs that any economic recovery will be hindered by a weak job market and flat incomes.

Most economists think the recession is over, but they say the jobless rate will keep rising until at least next summer as the economy struggles to mount a sustained recovery. That means household incomes will remain depressed and consumer spending, which accounts for 70 percent of the economy, will continue to lag.

“Firms are still not hiring, and that reflects deep pessimism about the sustainability of the economic recovery once government stimulus programs wear off,”said Sal Guatieri, senior economist at BMO Capital Markets.”The lack of job creation remains a big headwind for cash-starved and credit-constrained consumers.”

The nation’s major retailers on Thursday reported lackluster results from August back-to-school sales. Results in established stores fell 2.1 percent in August compared with the same month last year, a compilation of 31 retailers’ results by the International Council of Shopping Centers and Goldman Sachs indicated. Some major discounters managed to exceed expectations. Read the rest of this entry »

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The U.S. economy makes the worst recession

Posted by Tetyana Matychak in Trading Markets on April 29th, 2009

The U.S. economy plunged again in the first quarter, making this the worst recession in at least half a century.

Gross domestic product dropped at a 6.1 percent annual pace, weaker than forecast, after contracting at a 6.3 percent rate in the last three months of 2008, the Commerce Department said today in Washington. The report, which reflected a record slump in inventories and further declines in housing, came hours before Federal Reserve officials said the economy continued to contract at a “somewhat slower” pace.

Smaller stockpiles may set the stage for a return to growth in the second half of the year amid signs Fed efforts to reduce borrowing costs and unclog lending are starting to pay off. The contraction persisted even as lower gasoline prices and larger tax refunds helped bring an end to the worst slump in consumer spending in almost three decades.

“We are likely to emerge from this recession very slowly and the recovery will be very weak,” said Richard Berner, chief U.S. economist at Morgan Stanley in New York. “The aggressive policy response we have gotten will take time to work, but it will counter the still-strong headwinds holding the economy back.”  Read the rest of this entry »

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