The March jobs report was disappointing, well below the expectations of economists. The same thing occurred a year ago, and the jobs numbers bounced back after the first quarter. A harsh winter in many parts of the country this year, as last year, affected first quarter economic performance.
Steve Benen has the April jobs numbers. Job market bounces back, unemployment inches lower:
The new report from Bureau of Labor Statistics shows the U.S. economy added 223,000 jobs in April, which is almost exactly what experts predicted. The overall unemployment rate inched lower to 5.4%, the lowest it’s been since May 2008.
The revisions were a mixed bag. February’s job totals were revised up, from 264,000 to 266,000, while March’s totals turned out to be even worse, dropping from 126,000 to 85,000.
All told, the U.S. has added 2.98 million jobs over the last 12 months. April was the 55th consecutive month of positive job growth — the best stretch since 1939 — and the 62nd consecutive month in which we’ve seen private-sector job growth, which is the longest on record.
Here’s another chart, this one showing monthly job losses/gains in just the private sector since the start of the Great Recession.
The fact that the U.S. economic recovery continues is remarkable, given that the rest of the world’s major economies are slowing down, or have been stuck in a prolonged period of sluggish growth.
The Eurozone economy, which had a double-dip recession and has been uderperforming for years due to austerity economic measures, showed a slight uptick in economic performance after a long overdue change in policy with an Aggressive ECB Stimulus Plan instituted earlier this year.
The European Commission said it was revising upward its forecast for Eurozone economic growth this year to 1.5 percent, from 1.3 percent, accelerating from the 0.9 percent growth posted last year. For 2016, the commission predicted that the eurozone economy, composed of the 19 member nations that share the euro, would grow by 1.9 percent. Economic Growth in Eurozone Appears to Be Gaining Momentum (just barely).
In probably the most under-reported economic news in the U.S., after a long period of stunning growth, China’s economy is now slowing. There is a very real risk that China’s rapid development has inflated a real estate investment bubble that, if it bursts, would do substantial harm to the world’s economy, just like the U.S. crash did in 2008. Why China’s slowdown matters:
The government wanted a slowdown, and has encouraged it because there are long-term forces that mean it was inevitable sooner or later.
Better, if possible, to have a gentle slowdown – called a “soft landing” – than a disruptive one.
More fully, China’s very fast economic growth was based on some factors that could not last forever.
Very high levels of investment have been part of the story.
Last year, the figure was 48% of economic activity, or gross domestic product (GDP), according to IMF data.
There are only a few other economies where the figure is so high.
Most are in the 15-30% range.
Investment is certainly essential for improving the capacity of the economy for the future.
High investment rates have been important factors in other Asian economic success stories.
But you can have too much of a good thing.
It can lead to instability in property prices if there is heavy investment in construction, and there have been persistent concerns about whether China might have a property market crash.
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China also imports a lot, which is one reason why its slowdown matters to the rest of the world.
China is the second biggest importer of both goods and commercial services.
It is the biggest export destination for Thailand, and comes in second place for Indonesia, South Africa, Brazil and Japan (and for the last two, it is not far off first place).
For the European Union, China comes in third. And for the UK and the US, it is number four. (These are World Trade Organization figures, which treat the European Union as a single export destination.)
China has an important role as a buyer of oil and other commodities, and the slowdown has been a factor in the decline in the prices of those goods.
So even if China’s more moderate growth is a good thing in the long term, it has had an adverse impact on some countries, especially commodity exporters.
There is also the possibility of financial instability spreading from China.
Since the financial crisis, debt in China has grown rapidly.
A recent IMF report specifically expressed concern about the property market and how it might affect companies that had lent to that business.
It said: “In China, exposures to real estate (excluding mortgages) are almost 20% of GDP, and financial stress among real estate firms could lead to direct cross-border spillovers.”
These global economy economic issues are hanging like a sword of Damocles over the world’s economy. But the U.S. media never reports economic news.
Americans could very well wake up one day to news of another economic crisis, and they will rightfully ask, “When the hell did this happen? Why didn’t anyone tell me?” And the right answer will be the corporate news media are to blame. (Of course, Republicans and their media whores will blame Obama).
Here’s an idea: less weather, sports and entertainment news, more economics and foreign reporting. Go back to old school reporting when “news” was reporting and not “infotainment” to cross-market network programming.