Your Monthly Update in U.S. Economic Trends
New College Graduates Find Strong Job Market
A recent survey by the National Association of Colleges (NACE) reported that employers are planning to hire 16% more college graduates in 2008 than in 2007 as the baby boomer generation reaches retirement age. According to NACE, 54% of employers plan on using signing bonuses to entice potential graduates, up from 47% in 2007. Employers plan on raising salaries and other financial incentives to compete with competitors in landing new graduates. Average starting salaries are already 4% higher than they were in the winter of 2007, the report showed. High demand degrees include marketing, engineering, and computer science. Graduates who studied chemical engineering stand to see the biggest increase in starting salaries raising 6.2% to $63,749. Liberal arts graduates started 2008 with a 9% increase bringing their average starting salary to $33,258.
USAToday.com – March 10, 2008
Quarterly Economic Forecast Released
According to Anderson Forecast, a quarterly economic report released by the University of California at Los Angeles, the economy is expected to avoid a recession amidst a struggling housing market and higher gas prices. The forecast anticipates the job market to continue to slow in 2008, with the unemployment rate rising to 5.5% by the end of the year. The report also expects the economy to post a gross domestic product (GDP) growth gain of around 1.5%, rising to about 3% in 2009. The GDP was 2.2% in 2007.
MSNBC.com – March 11, 2008
Retailers Report Improving Sales in February
February sales, still a little slow, show signs of improvement, according to Ken Perkins, president of RetailMetrics LLC, a research company. According to Perkins, sales in February reversed their downward slide over the past six months. Thomson Financial reported that 16 retailers beat pessimistic forecasts, while nine retailers missed expectations, and one met projections. The numbers are based on sales at stores open at least a year. Wal-Mart Stores, Inc. beat expectations of a 1.1% gain, reporting a 2.6% gain in same-store sales, and Target Corp. reported a 0.5% increase, above analysts’ expectations of a 0.2% increase. Stores that saw declines include Limited Brands, Ann Taylor Stores Corp., and Gap Inc.
MSNBC.com – March 6, 2008
Gas Prices Hit All-Time High
Gasoline prices recently rose to an average price of $3.25 a gallon, according to a survey released by AAA, two cents higher than the previous record of $3.23 in May 2007. The average price for regular gasoline was $2.95 a gallon in February. The survey showed that California and Hawaii saw the highest increase in gas prices paying on average $3.61 a gallon, while consumers in New Jersey and Missouri saw nearly a 60 cent decrease in gas prices and are paying on average $3.03 a gallon.
CNNMoney.com – March 12, 2008
Employers Cut Jobs in February
The nation’s unemployment rate fell to 4.8%, down from 4.9% in January, according to the U.S. Department of Labor. Even with the decrease in the unemployment rate, employers added 63,000 fewer jobs in February than in January with most cuts in construction, manufacturing, retailing, and some professional and business services. Education and health care, leisure and hospitality, and government jobs posted gains.
FoxNews.com – March 7, 2008
Manufacturing Index Higher Than Expected
The Institute for Supply Management (ISM) reported that the manufacturing index fell to 48.3 in February, down from 50.7 in January. Though economists expected the index to fall to 48.1 in January, it fell to 48.3, according to the ISM. A reading above 50 indicates growth, while a reading below 50 shows contraction. The report also showed new orders were at 49.1 in February, down from 49.5 in January, and production was at 50.7, down from 55.2 in January.
Forbes.com – March 3, 2008
Federal Budget Deficit Increases
According to a report released by the U.S. Treasury Department, the federal deficit increased to $263.3 billion in the first five months of this budget year due to more government spending and less government revenues. The budget year began Oct. 1, 2007. The Congressional Budget Office said one of the reasons the deficit is higher is payments due March 1, 2008, were paid at the end of February, resulting in a higher budget deficit for the first five months of the budget year. The report showed the biggest spending categories include programs such as Medicare and Medicaid at $292.9 billion, Social Security at $270.5 billion, military at $247.6 billion, and interest on public debt at $198.5 billion.
MSNBC.com – March 12, 2008
Wholesale Inventories Increase
The Commerce Department reported an increase in the inventories and sales of U.S. wholesalers in January. According to the report released by the Commerce Department, wholesale inventories grew by 0.8% in January. Farm product sales grew by 16.1% in January, significantly contributing to total wholesaler sales, which grew by 2.7%. Sales of non-durable goods increased by 3% in January, while non-durable goods inventories rose by 1.2%, down from 1.8% in December. Durable goods sales increased by 2.4%, while inventories of durable goods increased by 0.6% in January. The report also showed the ratio of wholesale goods on-hand to sales fell to 1.07 in January, down from 1.09 in December. The ratio indicates the number of months sellers would need to deplete their current inventories.
CNNMoney.com – March 10, 2008
Service Sector Index Increased from January
The service sector index increased to 47.3 in February, up from 44.6 in January, according to the Institute for Supply Management. A reading above 50 indicates growth, while a reading below 50 shows contraction. Although the service sector index is still below the mark indicating growth, the slight increase in February from January’s record-low reading is improvement. The service industries make up nearly 90% of the nation’s economic activity.
Bloomberg.com – March 5, 2008
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