Labor Data Signal No End to Job Worries

Posted on by

By Ben Casselman U.S. businesses hired more workers in September than August, according to a report Wednesday, but the growth remained far too slow to bring down the high unemployment rate.In further worrying signs for the labor market, separate reports Wednesday showed that layoffs surged in September and that services businesses aren’t hiring more workers despite the sector’s relatively strong growth.Private-sector employers added 91,000 jobs last month, up from 89,000 in August, according to payroll processor Automatic Data Processing Inc. and Macroeconomic Advisers LLC, a consulting firm. The estimate has a mixed record predicting the government’s official jobs numbers, which are due Friday.Most economists expect the government data to show only a modest gain in September employment after the U.S. economy failed to add any jobs on balance in August.Paul Ashworth, an economist with research firm Capital Economics, said the ADP report should ease fears that the U.S. is heading into another recession. But he said it provided little indication that the recovery was gaining steam. “Seeing numbers hold up, even if they’re holding up at a relatively weak level, is encouraging,” Mr. Ashworth said. “It just shows how bad expectations have gotten that we’re happy” with such a weak figure.More worrying, Mr. Ashworth said, was a report released Wednesday by outplacement firm Challenger, Gray & Christmas that showed a sharp rise in layoff announcements in September. Employers planned to cut 115,730 workers last month, the report said, more than double the August tally and the worst in more than two years.A third of the planned layoffs came from government employers, including the Army, which cut 50,000 jobs as part of a five-year troop-reduction plan. More public-sector job cuts are likely as state and local governments lay off workers amid tight budgets.The other big source of job cuts was the financial sector. Bank of America alone cut 30,000 jobs in September, according to the Challenger report.The increase in jobs in the ADP report was driven by gains in the service sector, which added 90,000 jobs in September. Manufacturers, previously a source of strength, cut 5,000 jobs on balance as a cooling global economy reduced demand overseas for American goods.In a reversal from earlier in the recovery, service-sector growth now is outpacing growth among manufacturers, according to a report by the Institute for Supply Management. The institute’s monthly index of non-manufacturing activity was 53 in September, down slightly from 53.3 in August but still better than the 51.6 reading from the manufacturing index. Any reading above 50 denotes expansion on the 100-point scale.The institute’s report showed strong growth in new orders, which suggests the sector will continue to grow in coming months. Prices rose more slowly, reflecting moderating inflation.The report’s employment index, however, fell to 48.7 from 51.6, the first drop below 50 in over a year. Anthony Nieves, chairman of the committee that oversees the survey, said the slow pace of hiring suggests companies are taking a wait-and-see approach. Companies are unlikely to start hiring, Mr. Nieves said, until they see a clear sign the economy is improving—likely through a drop in the unemployment rate. But that can’t happen until companies hire more workers.”We’re in this vortex right now,” Mr. Nieves said. “You just wish something would break out now.” Write to Ben Casselman at ben.casselman@wsj.com …

More here:
Labor Data Signal No End to Job Worries

This information presented the Oregon & Washington consumer protection attorneys of Baxter & Baxter, LLP. Call today to speak to a Portland bankruptcy attorney, Hillsboro bankruptcy attorney, and Vancouver WA bankruptcy attorney. Click the links to learn more about Michael Baxter, Justin Baxter, Kirsten Baxter, Lyndon Ruhnke, and Lara Gardner.

Click the links to learn more about the National Association of Consumer Advocates and National Association of Consumer Bankruptcy Attorneys.

More articles and information about bankruptcy:

Filing for Bankruptcy: A Fresh Start

Comments are closed.