REPORTS SHOW ECONOMIC STRUGGLE
Hiring, manufacturing stay weak
9/20/2012WASHINGTON — Three reports Thursday offered a reminder that the U.S. economy is struggling to grow and add jobs.
The number of people seeking jobless benefits last week stayed near a level that signals only weak hiring in September. Manufacturing shrank for a fifth straight month in the Philadelphia region, a sign that weaker global growth has hurt demand for U.S.-made goods.
And a measure of future economy activity fell for the second time in three months.
The data followed a poor month of hiring in August and the Federal Reserve's move last week to launch stimulus measures to give the hobbled recovery a jolt.
“There certainly doesn't appear to be much improvement in the performance of the economy,” said Sam Bullard, senior economist at Wells Fargo Securities. “Manufacturing continues to soften and decelerate. We shouldn't expect to see substantial gains in hiring or output from manufacturers any time soon.”
Thursday's reports showed:
● Weekly applications for jobless benefits fell by only 3,000 last week to a seasonally adjusted 382,000, the Labor Department said. The four-week average rose for the fifth straight week to 377,750. Applications typically need to fall below 375,000 consistently to signal the job market is strong enough to lower unemployment.
● The Federal Reserve Bank of Philadelphia’s September index of regional manufacturing activity stayed below zero, which signals a market contraction.
The index rose to minus 1.9, but it has been negative since May. Nearly 23 percent of firms in the region reported declines in activity this month, a slight improvement from 30 percent in August.
The region includes firms in Pennsylvania, Delaware, and New Jersey.
● The Conference Board said its index of leading indicators dipped 0.1 percent in August. The report noted that manufacturing orders, consumer confidence, and average weekly manufacturing hours all slipped.
The index is intended to anticipate economic conditions three to six months out. The unemployment rate remains at 8.1 percent.
U.S. manufacturing, which had helped pull the economy out of the Great Recession three years ago, has weakened since spring.
Factories have been hurt by a drop in consumer spending and slower global growth that has cut demand for U.S. exports.
“Businesses clearly remain reluctant to aggressively boost their work forces,” wrote Jim Baird, chief investment strategist at Plante Moran Financial Advisors, to clients.