After an exciting non-farm payrolls report last week, today’s unemployment claims indicates that the labor market is still feeble as more than expected signed up for unemployment benefits.
In the week ended on November 9, jobless claims came in at 339K which is down from last week’s figure that was revised upwards to 341K, but the numbers came in 8K higher than expected, according to the Labor Department.
Although there are bright spots in the labor market, a strong holiday season is needed. An increase in consumer spending will be needed to drive growth forward, and companies should subsequently hire to fill the gaps to meet increased demand.
Ryan Sweet, senior economist at Moody’s Analytics Inc., said “all in all, it’s more of the same job market.” And this also dampers the mood for overly optimistic on a December taper from the Federal Reserve.
Data showed that employee productivity increased at an annualized rate of 1.9 percent as expenses per worker dropped to .6 percent.
The US trade deficit widens to a four-month high on increased imports. which is common as companies bring in merchandise for the holiday season. But, exports declined for the third consecutive month. Imports increased 1.2 percent on large shipments from Apple. Large quantities of semiconductors, computer equipment and civilian aircraft caused the increase in imports.
Wells Fargo economist Tim Quinlan believes the exports problem will be solved with the boom in US energy production. “Over the next year, faster global growth and the potential for increased U.S. exports in energy products.” The US will surpass Saudi Arabia as the world’s largest energy producer by next year.