As Economy Gains, Hopes For Jobs Rise
Latest U.S. Data Show Signs Of Employers Hiring Again
Washington — Fewer Americans are losing their jobs. Employers are struggling to squeeze more work from their staffs. The U.S. is producing so much oil that imports are plunging, narrowing the trade deficit.
New data yesterday raised hopes for stronger hiring and U.S. growth in coming months. More jobs would spur spending and help energize the economy, which has yet to regain full health nearly four years after the Great Recession officially ended.
And an interest rate cut yesterday by the European Central Bank, if it helps bolster the European economy, could also contribute to U.S. growth.
The U.S. economic reports came one day before the government will report how many jobs employers added in April. Economists think the gain will exceed the 88,000 jobs added in March, the fewest in nine months.
The government said yesterday that the number of Americans applying for unemployment aid fell last week to a seasonally adjusted 324,000 — the fewest since January 2008. Unemployment applications reflect the pace of layoffs: A steady drop means companies are shedding fewer workers. The figures for unemployment applications “point to potential improvement moving into May,” said Ted Wieseman, executive director of Morgan Stanley Research.
The government also said yesterday that the productivity of U.S. workers barely grew from January through March after shrinking in the last three months of 2012. Productivity shows how much employees produce per hour of work. When it remains weak, employers can’t keep pulling more output from their staffs. As customer demand strengthens, they’ll need to hire.
At the same time, the government said the U.S. trade deficit narrowed in March for a second month. The reason: The daily flow of imported crude oil reached a 17-year low.
A smaller trade gap is good for economic growth because it means America is exporting more while spending less on foreign goods.
The gap shrank 11 percent from February to $38.8 billion. Exports fell 0.9 percent, led by fewer shipments of U.S. machinery, autos and farm products.
But thanks to reduced U.S. demand for imported oil, imports fell even more — 2.8 percent. Petroleum imports fell 4.4 percent. Crude oil imports averaged 7 million barrels a day, the fewest since March 1996.
The U.S. isn’t using less oil. Rather, surging production has reduced the need for imported oil. U.S. output averaged 7.2 million barrels a day in March. That’s the most since 1992.
U.S. refiners have been taking advantage of low U.S. prices for oil and natural gas to produce fuels at much lower costs than their foreign competitors can.
Despite some encouragement from yesterday’s figures, the economy isn’t growing fast enough to reduce high unemployment. Since last year, the U.S. recovery has been held back, in part, by weak manufacturing. Earlier this week, for example, an industry trade group said the growth of U.S. factory activity slowed in April to its weakest pace this year. Even so, some manufacturers, particularly auto companies, are strengthening.