Economy Watch: Hiring Improves in April
- May 03, 2013
The U.S. economy created 165,000 jobs in April, according to the Bureau of Labor Statistics on Friday, which isn’t completely robust but at least puts to rest fears of a sharp slowdown in hiring. The number of jobs created in March, which was previously reported as an anemic 88,000, was also revised upward to a somewhat better 138,000 jobs, and the February increase was revised to a healthy 332,000 positions.
The unemployment rate, which is determined by a separate survey, came in at 7.5 percent, down from 7.6 percent March and down from 8.1 percent a year ago. Some of the drop represents job creation, but it also means that job seekers are giving up on looking for work. Employment increased in a number of categories during April, the BLS reported, including professional and business services, food services, retail trade, and health care.
On Thursday, the U.S. Department of Labor reported that for the week ending April 27, initial unemployment claims were 324,000, a drop of 18,000 from the previous week, and a welcome sign that layoffs are down since it was the lowest number since early 2008. The four-week moving average was 342,250, which represented an unusually steep decrease of 16,000 from the previous week.
Trade deficit narrows
The U.S. Department of Commerce said on Thursday that total March exports of $184.3 billion and imports of $223.1 billion resulted in a trade deficit of $38.8 billion, down from $43.6 billion in February. Exports are 11 percent higher than their pre-recession peak but unchanged compared to March 2012, while imports are 4 percent below the pre-recession peak and off 6 percent compared to March 2012.
China remains the number-one factor in U.S. trade deficits, with a $17.9 billion gap in March, though that was down from a $23.4 billion deficit in February, mainly because of the timing of the Chinese New Year. Other economic entities that the United States runs a trade deficit with include the EU, Japan, Mexico, Germany, OPEC, Canada, Ireland and Saudi Arabia. The United States has a trade surplus with a few places, however, such as Hong Kong, Brazil, Australia and Singapore.
Energy imports are less a factor now in the deficit than they have been recently. The price of a barrel of oil averaged $96.95 in March, up from $95.96 per barrel in February, but year-over-year, the price is down since a barrel averaged $107.95 in March 2012.
QE3 still a going concern
This week, the Federal Open Market Committee noted that it has “decided to continue purchasing additional agency mortgage-backed securities at a pace of $40 billion per month and longer-term Treasury securities at a pace of $45 billion per month,” as it said in a press statement. QE3 is alive and well, in other words. But the committee said it was “prepared to increase or reduce the pace of its purchases to maintain appropriate policy accommodation as the outlook for the labor market or inflation changes.”
Wall Street had a good day on Thursday after the release of the unemployment claims numbers, with the Dow Jones Industrial Average gaining 135.27 points, or 0.91 percent. The S&P 500 advanced 1 percent and the Nasdaq was up 1.04 percent.