A Jobless Recovery? Not This Time 15 comments
-
Font Size:
-
Print
- TweetThis
Early this week a survey release by the National Association for Business Economics (NABE) provided new evidence that the U.S. recovery is solidly under way and will be sustained well into 2010. The best news of the survey is that now a majority of companies surveyed are planning to boost their payrolls this year and next.
For the first time in over a year, the percentage of businesses expecting to hire workers over the next half year exceeds the share that project more layoffs.
Additionally the majority of firms now foresee that they will spend more on new capital equipment in the next six months adding more fuel to the growing recovery in 2010.
The survey shows that companies are generally becoming more optimistic about the future. As initial claims for unemployment continue to fall, the survey results are one strong signal that a return to job growth for the US economy is just around the corner.
The NABE survey's select group of retailers, health-care providers, hotels, restaurants, finance firms, insurance companies, and real estate employers all forecast job growth in 2010.
Much of the fuel for optimism has come from much better than expected results in Q3. Earlier in the year many economists had forecast lackluster results for Q3, but most firms have smashed those meager expectations. Since the start of the third-quarter reporting period, 80 percent of the companies in the S&Ps 500 Index have released better-than-expected results, according to Bloomberg, First Call, and Thomson earnings data. As a percentage so far, that's the best quarterly showing in 16 years.
Not only are a majority of firms beating Q3 expectations, forecasting job creation, and upping capital expenditures, but every single company polled this month anticipates the economy will expand in 2010.
Related Articles
|
-
The Seeking Alpha 100
See allThe top 100 stock
market authors
selected for publication
Seeking Alpha 100 » -
Fastest Climbers
Authors with the largestSee all
increase in followers
in the last 7 days
Fastest Climbers » -
Top Commenters
Top commenters,See all
as ranked by their peers
Top Commenters » -
Top Instabloggers
The 100 most active
Instabloggers.-
1
David Fry
-
2
TraderMark
-
3
Don Dion
-
4
Cliff Wachtel
-
5
Mike Havrilla
Top Instabloggers » -
1
-
Top StockTalkers
Top
StockTalkers.-
1
David Fry
-
2
Cliff Wachtel
-
3
Mike Havrilla
-
4
David White
-
5
Hedged In
Top StockTalkers » -
1
This article has 15 comments:
Pump, pump, pump.
I love all these words : anticipates, expects, forecast, foresee,etc.
I deal with facts, not hope and hype pal.
Was this article written by an asset gatherer? A CNBC anchor? Calafia beach pundit? Dr. Mark Perry? Larry Krudlow?
What nonsense. A complete and utter rationalization of the horrible economic climate out there.
Wake up pal, the US government, FED and Treasury is essentially providing all the "growth" in the economy right now. Growth thru monetary expansion.
Companies have been "beating" intentionally lowered analyst expectations by cost cutting, head count reductions, et al, not on revenue increases.
What a pack of outright lies and deceptions this 3 minute article was.
Brian Wesbury is that you?
"Additionally the majority of firms now foresee that they will spend more on new capital equipment in the next six months adding more fuel to the growing recovery in 2010."
So if 10% of companies plan more lay-offs, and 15% plan to hire, that leaves 75% maintaining employment levels, that would support the first item, yet mean little to nothing in terms of increasing employment.
The second item looks to me like any recovery will be of the "jobless" variety.
I am all for good news, but this might just be propaganda by business groups to maintain the current labor surplus economy in the US and global supply chain.
banks are still hoarding bailout funds in anticipation of the commercial & industrial real estate bubble, foreclosures ongoing, consumer credit card defaults, families struggling to make ends meet and ad infinitum.
All this, as our treasury is looted, the dollar on a broken roller coaster and its spend, spend, spend in Washington. All of this, while our 'esteemed legislators' spend valuable time and effort trying to perpetrate burdensome legislation on an already beleagured populace.
Clueless is not the word. This article reflects the eratz spin and
propaganda meant to make us believe we are in recovery mode???
Rubbish!
Careful there.
If 51% hire more workers
49% fire more workers
0% stay the same just to make it easy
You can still have net job loss!
I've seen 33% mass layoffs in both of the last companies I worked for. One of the companies had (2)... So you cut from 100 workers down to 66, then cut those 66 down to 45...
Granted these are during bust times, but during boom times I never saw the company increase the work force 33% in a year.
Some companies will incrementally be adding workers where they see fit... Possibly hiring furloughed or temp workers to perm... Meanwhile, other companies will still have the mass layoffs we've been seeing.
Bernake even warns of the possibility of a Jobless recovery, and so does Christina Romer over in the White House.
Saying that more companies plan to hire this year... you can't really make the connection that unemployment should go down. IBM could hire an extra 100 IT guys, meanwhile Citibank lays off 10,000 workers.
How ever brief, this was clearly an attempt to stimulate economic recovery solely through keyboard activity.
They talked to 78 different companies. It would be interesting to know WHICH 78 companies, of course... Who CHOSE the companies to approach for this questionaire?
They characterized unemployment as "...job losses slowing abating", not a particularly enthusiastic endorsement, and based that statement on their 78 respondents saying that:
31% will be cutting jobs (down from 36% last time)
12% will be adding jobs (up from 6% last time)
and the other 57% will be standing pat.
Again, NOT such a clearcut reason to see jobs springing up - or a recovery in general, of course.
Then there was the quote: "Respondents expecting their firms to add employees over the coming six months exceeded the number expecting job cuts for the first time since the recession began."
Without even the fractured statistical cover from the earlier estimates, this could mean just about anything, or nothing.
If 6 months from now those 78 companies have 20 cutting jobs and 21 adding jobs and 59 standing pat, is THAT going to represent a recovery with good job creation?
I think not.
On Oct 28 09:33 AM Old Trader wrote:
> "For the first time in over a year, the percentage of businesses
> expecting to hire workers over the next half year exceeds the share
> that project more layoffs."
>
> "Additionally the majority of firms now foresee that they will spend
> more on new capital equipment in the next six months adding more
> fuel to the growing recovery in 2010."
>
> So if 10% of companies plan more lay-offs, and 15% plan to hire,
> that leaves 75% maintaining employment levels, that would support
> the first item, yet mean little to nothing in terms of increasing
> employment.
>
> The second item looks to me like any recovery will be of the "jobless"
> variety.
On Oct 28 12:37 PM tripleblack wrote:
> I agree, Old Trader. Here are some factoids from the NABE:
>
> They talked to 78 different companies. It would be interesting to
> know WHICH 78 companies, of course... Who CHOSE the companies to
> approach for this questionaire?
>
> They characterized unemployment as "...job losses slowing abating",
> not a particularly enthusiastic endorsement, and based that statement
> on their 78 respondents saying that:
>
> 31% will be cutting jobs (down from 36% last time)
> 12% will be adding jobs (up from 6% last time)
> and the other 57% will be standing pat.
>
> Again, NOT such a clearcut reason to see jobs springing up - or a
> recovery in general, of course.
>
> Then there was the quote: "Respondents expecting their firms to add
> employees over the coming six months exceeded the number expecting
> job cuts for the first time since the recession began."
>
> Without even the fractured statistical cover from the earlier estimates,
> this could mean just about anything, or nothing.
>
> If 6 months from now those 78 companies have 20 cutting jobs and
> 21 adding jobs and 59 standing pat, is THAT going to represent a
> recovery with good job creation?
>
> I think not.
The Good News Economist?
Try The Fantasy Land Economist
On Oct 28 06:21 AM Archman Investor wrote:
> Wow. What an absolute waste of 3 minutes.
>
> Pump, pump, pump.
>
> I love all these words : anticipates, expects, forecast, foresee,etc.
>
> I deal with facts, not hope and hype pal.
>
> Was this article written by an asset gatherer? A CNBC anchor? Calafia
> beach pundit? Dr. Mark Perry? Larry Krudlow?
>
> What nonsense. A complete and utter rationalization of the horrible
> economic climate out there.
>
> Wake up pal, the US government, FED and Treasury is essentially providing
> all the "growth" in the economy right now. Growth thru monetary expansion.
>
>
> Companies have been "beating" intentionally lowered analyst expectations
> by cost cutting, head count reductions, et al, not on revenue increases.
>
>
> What a pack of outright lies and deceptions this 3 minute article
> was.
>
> Brian Wesbury is that you?
Obviously not, they were probably too busy "pumping"......
I'm not a proponent of economic isolationist but we've fallen way behind China and India in job creation through exports. India does not import American IT workers they mass produce and export them to the USA. Much (maybe most) of the things we purchase are made in ASIA. What good will we be to China, India and the World if we have fewer and fewer jobs to buy their exports with?
In today's fortune 500 companies "we're hiring" can mean, we are hiring in China and India (but much less in USA). Yes, low paying no benefit jobs will expand in the USA but the more traditional American professional high paying jobs will be expanding outside the USA.
Consider these few examples:
The largest market for DELL computers is still the USA, yet nothing is made here and all phone customer service centers are located in India, Asia and Latin America. I just bought some expensive Laptops from Dell and it will be the last thing I ever buy from Dell based upon how hard it is to deal with that outsourced customer service organizational structure.
Expanding business IT work means more India IT workers will be hired not USA IT workers ( like the 70's, 80's and 90's).
This is the news from India. BANGALORE/NEW DELHI: "With the US economy, the biggest market for India’s over $50 billion outsourcing industry, showing signs of an economic recovery, top honchos at Infosys, Wipro and HCL said their optimism has proven right. The financial results of the country’s top-three software exporters have already shown signs of recovery earlier this month."
"Topranked Tata Consultancy Services (TCS) grew its net profit by 29%. Wipro added 37 customers in the second quarter to September - the most in a year and a half"
"India’s software exports industry derives more than half of its revenue from the US."
If American consumers spend more money on NIKE $100 shoes NIKE hire's more Vietnam workers not American workers.
And now that much of Americas manufacturing base has been moved outside America gone too are all those white collar professional worker jobs.
Traditional American brand names like IBM and GE have expanded outside of the USA (not inside) over the last 20 years. So, even if the American consumer spending does pick-up it's unlikely to be as strong as we saw in 2002-2004 time period. And remember most of the products we buy are made outside the USA. Yes, a few companies like CAT, John Deere and Boeing still make products in USA and should hire more workers as their sales will be strong with a weak dollar. But most traditional factory jobs which were the life blood for many middle class workers and professionals like accountants, IT and engineer's are gone. There will be no call backs to work like we had during the 60's, 70's and 80's recessions.
So, keep the good news coming but I'm seeing another Great American Jobless Recession Recovery ahead for America and windfall job gain for China and India.