e-EDGE is now available as an RSS feed. [Click here to subscribe to it.]The Bureau of Labor Statistics just released its latest U.S. Labor Market Report covering the U.S. employment situation in April. The overall message was pretty positive on the employment side, not so positive on the household side. The unemployment rate ticked up, while nonfarm employment jumped in April and in March, especially in the private sector. Taken together, it appears the long downtrend in labor markets is nearing the end—and none too soon.
Looking first at the employer survey, total nonfarm employment grew by +290,000 jobs in April, compared with revised gains of +230,000 jobs in March, +39,000 jobs in February, and +14,000 jobs in January. This performance generated several nice comparisons: (1) April's monthly gain was the largest since March 2006. (2) This was the first four-month string of plus signs since the end of 2007. (3) Monthly job counts grew by an average of +94,000 workers during the first quarter, offsetting the fourth quarter average decline of -90,000 workers.
Government payrolls grew by +59,000 workers in April. The federal government stepped up hiring of temporary Census workers, while, state/local governments and school districts reduced headcounts by a combined -6,000 workers. Employment rolls in the private sector swelled by +231,000 workers last month, the fourth consecutive monthly increase following 24 dreary months of decline.
Looking at the private industry detail, eight of ten major sectors reported higher payrolls in April. Business & professional services employment grew by +80,000 workers (due in part to an increase of +26,200 jobs at temporary help agencies), and the leisure & hospitality sector reported an increase of +45,000 jobs. Manufacturing payrolls were up for the fourth consecutive month, this time by +44,000 workers. Private education & health care services employment rose by +35,000 jobs compared with March. In addition, job counts in construction and retail trade grew by +14,000 workers and +12,400 workers respectively. Financial activities and wholesale trade both reported low single-digit gains. Only two sectors reported payroll declines over the month and they were comparatively modest: transportation & warehousing (-19,500 jobs) and the information sector (-3,000 jobs).
The picture wasn't quite as rosy compared with April, 2009 (though the comparisons were less negative than in previous months). Nonfarm employers in the U.S. have reduced payrolls by -1,381,000 workers, a decrease of -1.0%. Private-sector employment dropped by -1,271,000 jobs, or -1.2% over this period. Three major private-sector industry groups reported higher payrolls versus last year: education & health services (+390,000 jobs); business & professional services (+24,000 jobs, due entirely to hiring by temporary help agencies); and leisure & hospitality (at +9,000 jobs, just crossing into positive territory). Employment has also increased in eight smaller industries: computer systems design services (up by +19,900 jobs); wholesale trade agents & brokers and electronic markets (+13,200 jobs); clothing & accessories stores (+12,600 jobs); department stores (+6,100 jobs); building materials & garden supply stores (+5,200 jobs); other information services (+4,400 jobs); scenic & sightseeing tours (+2,200 jobs); and oil & gas extraction (+1,700 jobs). On the downside, the construction and manufacturing sectors have shed large numbers of workers over the past year. Compared with April 2009, job counts have plunged by -554,000 jobs and -428,000 jobs respectively.
The separate BLS-sponsored survey of households cautioned that labor market conditions may not have improved as much as the April employer survey suggested. The U.S. unemployment rate was 9.9% last month, up by 0.2 percentage points from the January-March average though just below the 10.0% registered in December. Joblessness last month remained above the 8.9% rate of April 2009.
More people were looking for work in April than in March. However, it's unclear if they came back into the labor force because they thought jobs were becoming more available and success more likely (the "optimistic" reason) or because they or their families have become so financially stretched in this long recession that they simply had to go out and find a job (the "pessimistic" reason).
Comparing the major demographic groups with April 2009, jobless rates for adult men and women have risen by +0.7 percentage points and +1.0 percentage points respectively, while the rate for teenagers jumped by +3.6 percentage points. Over the same period, the unemployment rates for whites and Asians increased by +0.9 percentage points and +0.2 percentage points respectively. Meanwhile, joblessness among black and Hispanic workers grew by +1.5 percentage points and +1.1 percentage points respectively.
Labor market conditions deteriorated badly in this long downturn, and the problems have just begun to recede. Still, it appears the labor market recovery is finally under way. Total nonfarm employment plunged by -8.36 million workers in the 24 months between December 2007 and December 2009. On the upside, payrolls have increased by 573,000 workers in the four month since December. That's progress, though there's still a long, long way to go. (Nancy D. Sidhu)
Source: http://www.bls.gov/news.release/pdf/empsit.pdf
California’s overall budget position in April was worse than expected, but behind the numbers, the results were mixed. Total receipts were up compared to the same period last year, but still fell short of disbursements by -$8.3 billion. The State’s cash balance now stands at -$20.2 billion (an improvement over March when the cash balance stood at -$22.6 billion). The latest financial results released by the State Controller for the General fund show that during the first ten months of FY 2009-2010, total receipts increased by +1.9% to $68.6 billion (up by +$1.3 billion compared with the same period last year). Total disbursements fell – dropping by -$10.1 billion to $78.7 billion (or by -11.3% on a year-over-year basis). While the year-over increase in revenue is welcome news, last month’s receipts dropped below the Governor’s January budget estimates by -$3.6 billion (or -26.4%). Through March, State revenues were tracking +$2.3 billion ahead of projections.
Looking at the “big three” revenue sources for the ten months, corporate tax receipts declined by -4.4% to $7.2 billion (compared with April 2009 fiscal year-to-date) while revenues from retail sales and use taxes surged by +14.0% to $20.6 billion. Personal income taxes fell by -3.1% to $36.4 billion compared to the same period last year. The drop in personal income taxes accounted for most of the shortfall in projected revenue last month. Not only have statewide high unemployment rates had a major impact on income tax collections, but income taxes collected from small business owners have dwindled as well. Small businesses continue to struggle as a result of lackluster consumer demand, and since business income tax payments are based on expected tax liability for the year, the payments received from business owners have declined considerably. Overall, collections for the “big three” revenue sources got enough of a boost from the gain in sales and use taxes to post a +1.6% increase during the first ten months of the fiscal year.
On the expenditure side, Local K-12 Education received $26.4 billion during July 2009 – April 2010, a decrease of -$2.8 billion (-9.5%) from the same period last year. Community Colleges received $3.3 billion, a decrease of -$143.9 million (-4.3%) over the prior year. Overall payments to the UC/CSU systems have been slashed to the bone – as of last month, disbursements to the State’s two university systems plunged by -53.6% to $2.5 billion. Some of the shortfall in state payments was reimbursed by Federal stimulus funding, but not all. Contributions to CALSTRS (the K-12 teachers’ pension fund) were up for the year – rising by +10.1% to $1.2 billion.
Spending for the Department of Corrections contracted sharply last month, declining to $7.1 billion (-13.7%) compared with $8.2 billion during the previous year. Spending on Health and Human Services fell by -13.1% to $1.7 billion. Payments to Legislative/Judicial/Executive tumbled by -12.1% to $1.2 billion compared with last year, while spending on General Government slipped by -1.0% to $1.3 billion.
As of the end of April, the State had $28.6 billion in borrowable resources against $20.2 billion in outstanding loans, which left just $8.4 billion in unused borrowable resources. The outstanding loan balance of $20.2 billion is comprised of $11.4 billion of internal borrowing and $8.8 billion of external borrowing (short-term revenue anticipation notes). Of the total, $11.9 billion was carried forward from the previous fiscal year, with the remaining $8.3 billion debt accumulated in the current fiscal year. (Kimberly Ritter)
PR: http://www.sco.ca.gov/eo_pressrel.html
In March, consumer credit edged up a bit, increasing by +1.0% after contracting by -5.6% in February. By dollar volume, total consumer credit rose by +$2.0 billion over the month (seasonally adjusted) after falling by -$11.5 billion in February.
Revolving debt, including balances owed on store charge accounts and bank credit cards, declined by -$3.2 billion in March (-4.5%). March marked the fourteenth consecutive monthly decline for revolving consumer debt. Over the past year, revolving debt has slumped by -8.7%.
Non-revolving debt, including auto loans rose by +3.9% or +$5.2 billion in March. Over the past 12 months, non-revolving debt declined by -0.2%. A year ago, non-revolving debt was still growing by +0.5%.
Over the past year, total consumer credit outstanding fell by -3.3% or -$84.2 billion. Total consumer credit has plunged by -$130.5 billion from its peak in July 2008. (Kimberly Ritter)
Source: http://www.federalreserve.gov/releases/g19/Current/
Vehicle sales increased over the year in April for the sixth consecutive month. Total light vehicle sales last month were 11.2 million (seasonally adjusted annual rate or SAAR), up by +21.5% from April 2009. Over the month, however, sales fell by -4.9% compared with March.
Total car sales, including both foreign and domestic, climbed by +17.4% last month from twelve months earlier (to 5.6 million SAAR). Foreign auto sales edged up by +2.2% (to 1.6 million SAAR), while sales of domestic models advanced by +25.2% (to 3.9 million SAAR). On a month-over basis, domestic sales dropped by -8.1% and sales of foreign nameplates fell by -5.2%.
Combined sales of foreign and domestic light trucks were also up last month. Over the year, total light truck sales rose by +25.9% (to 5.6 million vehicles SAAR). Over the month, the number of light trucks sold was down by -2.4% after rising by +17.8% in March. Domestic models continued to lead in the light truck segment. Rising by +26.9% (to 4.8 million SAAR), sales of domestic nameplates drove last month’s year-over increase, although sales of foreign models also rose (up by +6.7% to 0.8 million SAAR).
Sales of medium-heavy trucks posted a strong gain in April, increasing by +23.5% compared to the same period last year and were up over the month by +11.7%.
Automotive sales in April represented a significant improvement over this time last year, but were still weak compared with prerecession levels. Most industry analysts are confident light vehicle sales have troughed, but the numbers in April were a warning to automotive manufacturers that they are not out of the woods yet and cannot afford to grow complacent about the return of consumer demand for their cars and trucks. (Kimberly Ritter)
Source: www.bea.gov
The March data from PKF Consulting indicate that Northern California’s hotel business is exhibiting some signs of life. In San Francisco, the March occupancy rate was 76.8%, up by +12.4% over last year’s 68.3%. The average daily room rate (ADR) declined by -6.8% to $149.41, so revenue by available room was up. By area in the City, the highest occupancy rate of 86.0% was found in tourist-centric Fisherman’s Wharf. That was up by +15.3% over the year, while the ADR was down by -4.4%.
In San Jose/Peninsula, the March occupancy rate was 67.9%, up by +18.3% over last year’s 57.4% rate. The ADR declined by -6.6% to $117.72, so again revenue per available room is up. (Jack Kyser)
March total passenger traffic and air cargo reports are in from Los Angeles International Airport (LAX) and Ontario International Airport. LAX reported higher levels of passenger traffic compared to a year ago and the same result with regards to air cargo.
LAX total passenger counts (domestic and international) came in at 4.7 million passengers in March. Domestic passengers numbered 3.5 million and international passengers totaled 1.2 million. LAX experienced a rise of +3.8 percent in total passenger traffic compared to March 2009. Total air cargo tonnage was up by +23.8 percent from March 2009 to March 2010.
Ontario International Airport’s passenger traffic figures were lower, moving down by -4.4 percent in March over the year. Meanwhile, air cargo tonnage fell by -2.5 percent from March 2009. (Ferdinando Guerra)
PR: http://www.lawa.org/welcomelax.aspx
http://www.lawa.org/welcomeONT.aspx
Wednesday, May 12, 2010: International Trade Outlook: L.A. County's Global Economic Ties
Breakfast & Networking: 8:00 a.m. - 9:00 a.m. Program: 9:00 a.m. - 10:30 a.m. At Hilton Long Beach & Executive Meeting Center, Catalina Ballroom (701 West Ocean Boulevard).
As the largest trading partner with L.A. County, China’s investment into the region has created thousands of jobs for Angelenos. In the first of a series of key country reports, the Kyser Center for Economic Research will release a special report on China. This dynamic country of more than 1 billion people ranks as the ninth largest source of foreign-owned and -affiliated companies in Los Angeles County. The LAEDC will also present its annual International Trade Trends & Impacts report for the Southern California region.
Saturday, June 12, 2010: Valley Economic Development Center: Where's the Money? Access to Capital Business Expo
8am - 2:30pm. Sheraton Los Angeles Downtown (711 South Hope St.). Only $10 to register! Registration Includes: Breakfast—Expo—Lunch—Workshops—One on One Consultation.
Join us for a day of Education, Resources & Business Growth! Discuss your financing needs with lenders – schedule a one-on-one consultation. Obtain information from a wide range of business resource providers. Attend workshops where these topics will be discussed by panels of experts.
The Economic Data Global Express (e-EDGE) is a free service of the Los Angeles County Economic Development Corporation (LAEDC). Permission to quote any proprietary part of this release is granted given proper credit. Distribution is allowed provided that no modifications are made to the original content. Sponsors of this service do not necessarily endorse all opinions stated herein. For more information, please e-mail to eedge@laedc.org. To contact LAEDC, please call 213-622-4300.
Subscribe to e-EDGE and receive current economic news and major developments. Your e-mail address will not be disclosed to any outside party (including e-EDGE sponsors) under any circumstances.
To send us comments regarding e-EDGE, please e-mail to eedge@laedc.org.