Lukewarm Jobs Report; Uptick in Construction Spending
- Oct 23, 2013
The delayed U.S. employment report for September from the Bureau of Labor Statistics, which was finally released on Tuesday, turned in a modest 148,000 new jobs for the month and noted a downtick in the unemployment official rate, from 7.3 percent to 7.2 percent — though that was mostly because of a small decline in workforce participation. Other employment indicators (besides the headline numbers) were likewise middling.
For example, the number of workers unemployed for more than 26 weeks – but who still want a job – was 4.1 million in September. That was a slight improvement compared with August, when the total was a little less than 4.3 million. The number of long-term unemployed has been slowly dropping since the end of the recession, but it still represents a serious problem. Many millions of people are at risk of being a lost generation of workers.
Also, state and local governments added 28,000 jobs in September. So far this year, and state and local employment is up 82,000, perhaps indicating that the long decline in hiring by those segments of the public sector is over. On the other hand, federal employment keeps dropping, and the last time federal payrolls were this size was in 1966.
Construction Spending Sees Uptick
On Tuesday, the Census Bureau released figures for U.S. construction spending in August, another report delayed by the recent government shutdown. According to the report, construction spending during August was at an annualized rate of $915.1 billion, 0.6 percent higher than the July total. The August figure is 7.1 percent above the August 2012 annualized rate of $854 billion.
Both private and public construction saw upticks. Spending on private construction projects was up 0.7 percent month-over-month, while public construction spending was 0.4 percent higher in August than July.
Leading the way was residential construction, which was up 1.2 percent month-over-month. On the other hand, private nonresidential construction barely budged, rising 0.1 percent for the month. In the public sector, educational constructed posted a 1.3 percent increase, while highway construction edged up only 0.1 percent in August compared with July.
Energy Production Surges Regionally
The Energy Information Administration has also been busy issuing reports delayed by the shutdown. On Tuesday the agency released its first-ever Drilling Productivity Report, which tracks the surge of oil and gas production in various parts of the country. Among other findings was that the Bakken (mostly North Dakota) and Eagle Ford (South-Central Texas) regions together account for about 75 percent of current monthly oil production growth across the six regions tracked in the report.
Over the past year, production in these two regions increased by nearly 700,000 barrels per day. Also, although natural gas production increased in four of the six regions over the past year, the Marcellus (Pennsylvania and West Virginia) region alone accounted for about 75 percent of natural gas production growth in the six regions.
Wall Street had a good day on Tuesday despite the jobs report, perhaps believing that the Fed will continue to stimulate the economy. The Dow Jones Industrial Average gained 75.46 points, or 0.49 percent. The S&P 500 advanced 0.57 percent and the Nasdaq was up 0.24 percent.