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Millions of U.S. workers to see pay raise with minimum wage hike to $7.25

Posted Jul 14th 2009 3:00PM by Joseph Lazzaro (RSS feed)
Filed under: Forecasts, Good news, Employees

The lowdown on the July 24 increase in the the federal minimum wage? It will be net positive for the U.S. economy.

From the rhetoric of the supply side theorists --- the same people who advocated more than $1 trillion in 2001-2008 upper-income-favoring tax cuts that created the fewest jobs in any eight-year presidency since World War II --- increasing the minimum wage by 10.7 percent to $7.25 per hour will mark the end of the free enterprise system in the United States, or something close to it.

Continue reading Millions of U.S. workers to see pay raise with minimum wage hike to $7.25

November payroll loss points to likely lower corporate revenue, earnings

Posted Dec 3rd 2008 9:58AM by Joseph Lazzaro (RSS feed)
Filed under: Bad news, Employees, Recession

Nonfarm private employment decreased an enormous 250,000 in November (pdf) on a seasonally adjusted basis, ADP announced Wednesday.

Meanwhile, the October estimated change in employment was revised to a decrease of 179,000 jobs from the previously-announced decrease of 157,000 jobs.

While manufacturing employment fell 118,000 in November -- its 27th consecutive monthly decline -- the service sector of the economy lost 92,000 jobs -- its second consecutive monthly job loss, and the first back-to-back monthly job loss in that sector since November 2002.

Economist Richard Felson said the November ADP private sector report shows a U.S. economy with few strengths. "It is another distressing report. The fact that the service sector is now registering large job losses is bearish for the economy. Previously, the service sector had been the only sign of strength," Felson said. "Simply, the nation, and the other regions of the world need to create engines of growth to reverse this negative spiral of decreased demand, lower revenue, job losses, decreased demand."

Most of the decline in employment during November was accounted for by job losses at medium-sized companies, which registered a 130,000-job decline. Meanwhile, large businesses cut 41,000 jobs in November. Small businesses cut 79,000 jobs during the month.

Continue reading November payroll loss points to likely lower corporate revenue, earnings

Non-farm U.S. private payrolls fall 157,000 in October, more trouble ahead

Posted Nov 5th 2008 11:30AM by Joseph Lazzaro (RSS feed)
Filed under: Bad news, Employees, Economic data, Recession

Non-farm private employment decreased a whopping 157,000 in October on a seasonally-adjusted basis, ADP announced Wednesday in the ADP National Employment Report (pdf).

Meanwhile, the September estimated change in employment was revised to a decrease of 26,000 from the previously announced decrease of 8,000 jobs, ADP said.

Manufacturing employment fell 85,000 in October -- its 26th consecutive monthly decline. Meanwhile, the service sector of the economy lost 31,000 jobs, the first monthly job loss in the service sector since November 2002.

Economist Richard Felson said the October ADP private sector report offered little good news for the U.S economy.

"It is a large monthly job loss, and even more distressing was the job loss total in the service sector," Dawson said. "Up until now the service sector was creating jobs, helping to prop up the economy. The fact that services lost jobs in a month for the first time in six years is a bad sign for the economy because it removes one of the few remaining bright spots in the job market. Job market conditions have worsened and we're likely to continue to see 100,000-plus job loss months for awhile, I'm afraid."

Continue reading Non-farm U.S. private payrolls fall 157,000 in October, more trouble ahead

U.S. service sector slows less than expected in May

Posted Jun 4th 2008 2:36PM by Joseph Lazzaro (RSS feed)
Filed under: Good news, Economic data

Register a mild, positive data point for the U.S. economy. In May, the U.S. service sector slowed at a pace less than economists had expected.

The Institute for Supply Management announced Wednesday that its non-manufacturing or service index nudged lower to 51.7% in May from 52.0 in April. Readings above 50 indicate an expansion; below 50, a contraction. Hence, because the index remained above 50 in May, the expansion in the service sector continued for a second straight month, the ISM said. Economists surveyed by Bloomberg News had expected the services index to decline to 51.0 in May.

Thirteen of the ISM's service industries grew in May. The ISM added that members' comments in May reflected concern about business conditions, including rising costs, and the overall sluggish U.S. economy.

Economic Analysis: Many economists tend to place less emphasis on the ISM services index, compared to the capital-intensive manufacturing index. Still, the services index does provide helpful clues regarding the economy and the May statistic further confirmed that the U.S. at mid-year is experiencing very sluggish, region-specific growth, but not a contraction -- at least not yet. Credit conditions are tight, but credit availability has not been totally shut down. Corporations large and small are tightening their belts, but some business-to-business spending is occurring. Lay-offs are occurring, but so far, there is no tidal wave of layoffs.

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Last updated: November 10, 2009: 12:13 PM

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