Economy Watch: No Jobs Numbers for September
- Oct 04, 2013
On Friday, the Bureau of Labor Statistics did not release its customary monthly report on the U.S. employment picture, which is one of the most closely watched economic indicators produced by the federal government. Reportedly only three top employees at the BLS are coming to work, with the rest furloughed. It isn’t clear whether the report will ever be issued, since the length of the federal government shut down isn’t clear yet either.
The U.S. Department of Labor, however, did report on Thursday that for the week ending Sept. 28, initial unemployment claims were 308,000, an increase of 1,000 from the previous week. The less jumpy four-week moving average was 305,000, a decrease of 3,750 from the previous week’s revised average.
The four-week average was the lowest since May 2007, before the onset of the recession, and the weekly average is almost as low as it was during the mid-2000s and the late 1990s. The weekly numbers will continue to be reported regardless of the length of the federal shutdown, since the states actually collect the numbers and pass along the data to Labor.
ISM reports that non-manufacturing activity up in September
Economic activity in the U.S. non-manufacturing sector grew in September for the 45th consecutive month, according to the latest Non-Manufacturing ISM Report On Business, which was released on Thursday by the Institute of Supply Management. But growth wasn’t as much as in August: the index registered 54.4 percent in September, 4.2 percentage points lower than August.
The Non-Manufacturing Business Activity Index decreased to 55.1 percent, or 7.1 percentage points lower than in August. The New Orders Index dropped by 0.9 percentage points to 59.6 percent, and the Employment Index was down 4.3 percentage points to 52.7 percent.
According to the report, 11 non-manufacturing industries reported growth in September, among them retail trade; transportation and warehousing; utilities; and construction. Four industries reported contraction: arts, entertainment and recreation; educational services; health care and social assistance; and mining.
Treasury warns about U.S. sovereign default
The U.S. Department of the Treasury also released a report on Thursday—one that’s presumably been in the works for a while, and which needed no large staff to release—called “The Potential Macroeconomic Effect of Debt Ceiling Brinkmanship.” In it, the department warned that a “default would be unprecedented and has the potential to be catastrophic: credit markets could freeze, the value of the dollar could plummet and U.S. interest rates could skyrocket, potentially resulting in a financial crisis and recession that could echo the events of 2008 or worse.”
Treasury also asserted that “political brinksmanship that hints at even the prospect of a default can be disruptive.” The report harkened back to the last time Congress quarreled with itself over the debt ceiling, in the summer of 2011, saying that at the time, consumer and business confidence dropped, job growth stalled and financial markets were unsettled by the default uncertainty.
Wall Street was down on Thursday, perhaps weighed down by default worries—though most investors reportedly regard actual U.S. default that as a remote possibility. In any case, the Dow Jones Industrial Average lost 136.66 points, or 0.9 percent. The S&P 500 also was down 0.9 percent and the Nasdaq was off 1.07 percent.