The Economy and Jobs
Tomorrow a new jobs report for the month of May will be released to detail the most recent job numbers for the United States, the world’s largest economy. The Department of Labor in the meantime has released last week’s jobless claims report. The report shows a 10,000-claim increase in initial filings from last month’s numbers, bringing the week’s total to 383,000 new claims. After averaging the new number with the previous week’s, the average number of claims rises to 374,500 claims per week.
The increased jobless numbers foreshadow a decrease in consumer confidence, which, according to The Associated Press has already begun to plunge. Dropping to 64.9, down from 68.7 in the previous month, consumer confidence is a broad indicator of the population’s economic outlook. With consumer spending accounting for 70 percent of economic activity, the number can signify renewed fears of a weak job market. The number is much higher than the 40-point measure hit last October but still falls short of a 90-point measure that signifies a healthy economy, according to the AP.
Overall numbers for the unemployment rate remain at 8.1 percent, largely due to a high number of potential employees dropping out of the counting after giving up looking for work. A recent Washington Post article stated that the “proportion of Americans in their prime working years who have jobs is smaller than it has been at any time in the 23 years before the recession.” The employment rate for this group is 75.7 percent, which indicates little improvement in employment in recent years and also reflects workers who stopped looking for jobs, a number excluded from the traditional unemployment rate. Heidi Shierholz, an economist at the Economic Policy Institute commented on the measure saying, “The unemployment rate is screwy right now because the labor market is so weak that people have stopped trying.”
While Congress waits to find out where tomorrow’s jobs report falls, we only hope they think about ways to get out of the way of businesses try to create jobs. Check out our latest installment in our Story of Business here and hear about Rob Latham’s struggle to keep his business afloat.