The Trump Effect: Americans Working, Higher Wages, Booming Manufacturing
- The Trump Effect has Made America Great Again, and Is Keeping America Great!
The number of Americans filing for unemployment benefits fell to a near 49-year low last week, pointing to sustained labor market strength, which continues to underpin economic growth.
The labor market, which is viewed as being near or at full employment, is steadily boosting wage growth, which could help to support consumer spending as the stimulus from The Trump Administration’s $1.5-T tax cut package fades and tax cuts 2.0 looms
Initial claims for state unemployment benefits dropped 8,000 to a seasonally adjusted 207,000 for the week ended Sept. 29, the Labor Department said on Thursday. That reversed the increase from the prior week when claims were boosted by Hurricane Florence, which slammed North and South Carolina in mid-September.
Applications fell to 202,000 during the week ended 15 September, which was the lowest level since November 1969. Economists polled by Reuters had forecast claims slipping to 213,000 in the latest week. The Labor Department said claims for North and South Carolina continued to be affected by the storm.
The 4-week moving average of initial claims, considered a better measure of labor market trends as it irons out W-W volatility, rose 500 to 207,000 last week.
The claims data has no bearing on September’s NFP report, which is scheduled for release Friday.
According to a Reuters survey of economists, NFPs nonfarm likely increased by 185,000 in September after surging 201,000 in August. The unemployment rate is forecast falling 1/10th pt to 3.8%, an 18-year low 1st hit in May.
Payrolls growth may surprise on the Northside as data Wednesday showed an increase in hiring by private companies in September and a jump in private sector jobs.
In a separate report on Thursday, the Commerce Department said new orders for U.S.-made goods recorded their biggest increase in nearly a year in August.
Factory goods orders surged 2.3%, the largest increase since September 2017, boosted by a surge in demand for aircraft, after falling 0.5% in July. Orders increased 8.6% on a Y-Y basis in August.
Manufacturing, which accounts for about 12% of the US economy, is being supported by robust domestic demand.
An Institute for Supply Management (ISM) survey of manufacturers published Tuesday showed factory activity retreated from a 14-year high in September.
In August, orders for transportation equipment vaulted 13.1%, the largest gainer since June 2017. That reflected a 69.1% surge in the volatile orders for civilian aircraft and parts. Orders for defense aircraft and parts soared 17.0% in August. Transportation orders fell 3.6% in July.
Orders for motor vehicles rose 1.0% in August after increasing 1.6% in July.
There were increases in orders for primary metals, fabricated metal products and electronic equipment, appliances and components. But orders for machinery and computers and electronic products fell.
The US Commerce Department also said August orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans, fell 0.9%. Orders for these core capital goods rose 1.5% in July.
Core capital goods shipments increased 1.2% in July. Business spending on equipment slowed in Q-2 after growing robustly since Q-1 of Y 2017.
The Trump Effect has Made America Great Again, and Is Keeping America Great!