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Burgeoning 'Green Shoots' Bring Hope For An Economic Recovery

Kristina Hooper profile picture
Kristina Hooper


  • In the US, the creation of 2.5 million nonfarm payrolls in May and the drop in the unemployment rate was incredibly unexpected - even jaw-dropping.
  • May US car sales showed significant improvement over April - and for many automakers was better than expected. The rebound has been powerful enough that US automakers are even planning to keep factories open and working through their normal annual summer shutdown.
  • There are green shoots to be seen in Canada and Europe as well.
  • In China, a variety of indicators are suggesting the country is experiencing a substantial recovery.

By Kristina Hooper, Chief Global Market Strategist

Weekly Market Compass: Encouraging signs were seen in job creation, manufacturing and service activity, and auto sales.

The last time I used the term “green shoots” was the late spring and summer of 2009. Like everybody else, I was looking for signs of economic life after the global financial crisis and searching for indications that the US and other developed countries were rising out of the economic ashes like a phoenix. And now, 11 years later, I find myself again looking for - and finding - encouraging signs of recovery in the US and other major developed countries. In this week’s blog, I focus on some of the green shoots that I’ve seen in the last several weeks.

US: The May jobs report stuns, while automakers report a rebound

Let’s start with the most recent US jobs report. To say it provided a positive surprise is an understatement. The creation of 2.5 million nonfarm payrolls1 in May and the drop in the unemployment rate was incredibly unexpected - even jaw-dropping.

Now, there is a footnote to this jobs report. There was a classification error that made the unemployment rate look better than it actually was. Some furloughed employees, who should be classified as unemployed, were misclassified as employed. It turns out this happened in both April and May. If the Bureau of Labor Statistics were to correct the classifications, it seems that unemployment would have been five percentage points higher in April (19.7% instead of the reported 14.7%) and three percentage points higher in May (16.3% instead of the reported 13.3%).1 The good news is that the May jobs report was still a very significant improvement over April. Green shoots.

But it’s not just the jobs report. Take auto sales in the US - an area

This article was written by

Kristina Hooper profile picture
Kristina Hooper, CFP, CAIA, CIMA, ChFC, is Global Market Strategist at Invesco US. She earned a B.A. from Wellesley College, a J.D. from Pace Law and an M.B.A. in finance from NYU, where she was a teaching fellow in macroeconomics.

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