Economy Watch: Job Growth, Retail Spending
- Mar 04, 2011
March 4, 2011
By Dees Stribling, Contributing Editor
The U.S. Department of Labor said the economy added 192,000 jobs in February, which was a little more than economists expected and a reasonably strong showing despite international turmoil and annoyingly high gas prices. The government also reported the official unemployment rate at 8.9 percent, down from 9 percent in January.
The new strength of the job market was anticipated by other indicators, such as the Monster Employment Index, a monthly gauge of U.S. online job demand. It was up 4 percent year-over-year in February, with utilities and retail leading the growth, according to Monster Worldwide Inc.
Also, initial unemployment claims for the week ending Feb. 26 dropped unexpectedly, according to the Labor Department. The number fell 20,000 to a seasonally adjusted 368,000, the lowest number since May 2008.
Moreover, the Institute for Supply Management said on Thursday that its ISM Non-Manufacturing Index–the service industry, in other words–advanced to 59.7 in February from 59.4 in January. The rise was unexpected, and it put the index, which is already in the growth territory above 50, at its highest level since mid-2005. (The ISM had previously reported that some 57,000 new U.S. manufacturing jobs were added in February.)
Meanwhile, workers are more productive than ever, according to the U.S. Bureau of Labor Statistics, also on Thursday. During the fourth quarter of 2010, business labor productivity increased at annualized 2.6 percent; the rate for 3Q10 was also revised upward to 2.3 percent. For the entirety of 2010, U.S. productivity grew 3.9 percent.
Retail Spending Reasonably Strong in February
A number of same-store sales reports for major retailers came in, and in many cases they advanced more than predicted. JC Penney, for example, turned in a 6.4 percent increase, while department stores Nordstrom scored a 7.3 percent increase and Saks Inc. experienced a 15 percent increase.
All together, according to Retail Metrics, same-store sales across the 27 chains it follows increased by 5.3 percent when compared with February 2010. The retail data specialist added that retail sales have been increasing now without interruption each month for since mid-2009.
But not quite everyone was on the rising same-sales bandwagon. Gap Inc., for instance, saw same-store sales drop 3 percent.
Wall Street was feeling good on Thursday, perhaps happy that the unemployment claims were so low for the week, or maybe realizing that the situation in Libya isn’t the the end of the oil market as we know it, but in any case, the Dow Jones Industrial Average gained an impressive 191.4 points, or 1.59 percent. The S&P 500 advanced 1.72 percent and the Nasdaq ended in positive territory to the tune of 1.84 percent.