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Transcript of August Economic Data Results Sep 8
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8/11/2019 August Economic Data Results Sep 8
1/3
JUNE 2, 201
Cushman & Wake eld, Inc.1290 Avenue of the AmericasNew York, NY 10104www.cushmanwake eld.com
FOR MORE INFORMATION, CONTACT:
Ken McCarthySenior Managing DirectorEconomic Analysis and Forecasting(212) 698 [email protected]
The market terms and de nitions in this report are based onNAIOP standards. No warranty or representation, expressor implied, is made to the accuracy or completeness of theinformation contained herein, and same is submitted subject toerrors, omissions, change of price, rental or other conditions,withdrawal without notice, and to any special listing conditionimposed by our principals. 2013 Cushman & Wake eld, Inc.All rights reserved.
September 8, 2014A Cushman & Wakefield Research Publication
RESEARCH REPORT - WEEKLY ECONOMIC UPDATE
EMPLOYMENTDISAPPOINTMENTDOESNT INDICATE AWEAKER ECONOMY
Motor vehicle sales surged to the highest level in more thaneight years and the Institute for Supply Managements (ISM)monthly Purchasing Managers Indices rose, indicating strongeactivity in both the manufacturing and non-manufacturingsectors.
Job growth in August was a disappointment. The U.S. economyadded 142,000 jobs, the smallest increase since last December.In addition, the level of employment in both June and July wasrevised downward s lightly.
Of ce-using employment growth remains solid. The U.S.economy added 51,000 of ce-using jobs in August, markingthe fth consecutive month that job growth has exceeded50,000.
The unemployment rate declined, but this was a resultof a drop in labor force participation, as workers remaindiscouraged about job prospects.
THE FIRSTECONOMIC DATAFOR AUGUST WAS
RELEASED LAST WEEKAND IT WAS MOSTLYPOSITIVE, ALTHOUGH
THE GROWTHIN PAYROLLEMPLOYMENT
WAS SMALLER THANEXPECTED.
48
50
52
54
56
58
60
2010 2011 2012 2013 2014
Manufacturing Purchasing Managers' Index
Source: Institute for Supply Management. Note: A reading above 50 means manufacturing is expanding
MANUFACTURING PURCHASINGMANAGERS INDEX
U.S. auto producers reportedthat sales in the month of August
climbed to an annual rate of17.5 million cars
BIG NEWS!Motor vehicle sales surge
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8/11/2019 August Economic Data Results Sep 8
2/3
JUNE 2, 201September 8, 2014
FOR MORE INFORMATION, CONTACT:
Ken McCarthySenior Managing DirectorEconomic Analysis and Forecasting
(212) 698 [email protected]
The market terms and de nitions in this report are based onNAIOP standards. No warranty or representation, expressor implied, is made to the accuracy or completeness of theinformation contained herein, and same is submitted subject toerrors, omissions, change of price, rental or other conditions,withdrawal without notice, and to any special listing conditionimposed by our principals. 2013 Cushman & Wake eld, Inc.All rights reserved.
The early data on the performance of the economy in August wasreleased last week and it showed a mixed picture. Two privatesector business surveys from the ISM were very positive andmotor vehicle sales soared, but employment growth was muchslower than expected.
U.S. auto producers reported that sales in the month of Augustclimbed to an annual rate of 17.5 million cars, the strongest monthsince January 2006. U.S. consumers are likely to make 2014 thebest year for the auto industry since 2006.
The Institute for Supply Management reported that the purchasingmanagers indexes for manufacturing and non-manufacturing
industries both climbed sharply. The manufacturing index was atthe highest level since early 2011 and the non-manufacturing indexrose to its highest level since 2006. These indexes suggest a highlevel of con dence in the business community about the currentstate of the economy.
Cushman & Wake eld, Inc.1290 Avenue of the AmericasNew York, NY 10104www.cushmanwake eld.com
RESEARCH REPORTWEEKLY ECONOMIC UPDATE
EMPLOYMENTDISAPPOINTMENTDOESNT INDICATE AWEAKER ECONOMY
However, this positive news was offset by the unexpectedly weak jobs report. The U.S. economy only added 142,000 people topayrolls in August. The slowdown was exacerbated by downwardrevisions of approximately 30,000 to job growth in both June and
July. The August increase was the slowest since last Decemberand breaks a string of six consecutive months in which jobgrowth exceeded 200,000.
Sectors with signi cant growth included professional andbusiness services (+47,000 jobs), education and health (+37,000),construction (+20,000) and leisure and hospitality (+15,000).The growth in construction employment is particularlyheartening because these tend to be better-paying jobs. Over thepast 12 months, the economy has added 232,000 construction
jobs, the largest 12-month increase since the 12 months toSeptember 2006.
51,000
OFFICE-USING JOBS
INCREASE
UNEMPLOYMENTRATE
DECREASE
6.2% in July to
6.1% in August
3 6 0
2 2 6
2 4 3
9 6
1 1 0
8 8
1
6 0
1 5 0
1 6 1
2 2 5
2 0 3
2 1 4
1 9 7
2 8 0
1 4 1
2 0 3
1 9 9
2 0 1
1 4 9
2 0 2
1 6 4
2 3 7
2 7 4
8 4
1 4 4
2 2 2
2 0 3
3 0 4
2 2 9
2 6 7
2 1 2
1 4 2
0
50
100
150
200
250
300
350
T h o u s a n
d s o
f P e r s o n s
Payroll Employment Change(Change From Previous Month)
Monthly Change 6-Month Moving AverageSource:U.S.Departmentof Labor,Bureau of Labor Sta
PAYROLL EMPLOYMENT CHANGE (CHANGE FROM PREVIOUS MONTH)
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8/11/2019 August Economic Data Results Sep 8
3/3
JUNE 2, 201September 8, 2014
FOR MORE INFORMATION, CONTACT:
Ken McCarthySenior Managing DirectorEconomic Analysis and Forecasting
(212) 698 [email protected]
The market terms and de nitions in this report are based onNAIOP standards. No warranty or representation, expressor implied, is made to the accuracy or completeness of theinformation contained herein, and same is submitted subject toerrors, omissions, change of price, rental or other conditions,withdrawal without notice, and to any special listing conditionimposed by our principals. 2013 Cushman & Wake eld, Inc.All rights reserved.
Cushman & Wake eld, Inc.1290 Avenue of the AmericasNew York, NY 10104www.cushmanwake eld.com
RESEARCH REPORTWEEKLY ECONOMIC UPDATE
EMPLOYMENTDISAPPOINTMENTDOESNT INDICATE AWEAKER ECONOMY
The number of of ce-using jobs in the U.S. economy is at an all-timehigh and growing strongly. Job growth in both the professional &business service sector and the nancial sector boosted of ce-usingemployment by 51,000 jobs despite a decline in the informationsector. The decline in information employment, which shed 3,000
jobs in August, was centered in the motion picture and recordingindustry. In August, that industry lost 6,000 jobs and since July 2013,it has shed over 59,000 jobs.
The weakness in this report also includes anomalies, so wewould not be surprised to see a rebound in growth in September.Employment growth slowed in the manufacturing sector, which was
at in August after adding 64,000 jobs in the previous three months.This weakness is surprising given the August purchasing managersreport. Employment in the retail sector fell by about 8,400 jobs,after rising by an average of 28,000 in the previous ve months.The decline in retail appears to be partially related to a labordispute. Its likely that this decline will be reversed in Septemberas the dispute has been resolved.
The unemployment rate declined from 6.2% in July to 6.1% inAugust, but this was more a result of a decline in the labor forcethan rising employment. In fact, the labor force participation ratedropped to 62.8%. It has been hovering around that level, the lowestsince 1978, for most of the past year. This re ects the fact that
there are still a lot of discouraged workers who are not yet activelyseeking jobs because they do not feel employment prospects aregood.
Overall, the healthy data reported by the ISM and the strong motorvehicle sales report suggest the economy is on a much sounderfooting than the employment report indicates. Even with thedisappointing August report, job growth in 2014 has been robust.In the rst eight months of the year, the U.S. economy has added1.72 million jobs, the strongest eight-month growth since 2005.
We remain optimistic that the economy is now growing at thestrongest sustained pace since the recovery began ve years ago.
If we are correct in this, the economic environment for commercialreal estate is the best we have seen since the mid-2000s.
EVEN WITH THEDISAPPOINTINGAUGUST REPORT,
JOB GROWTH IN
2014 HAS BEENROBUST.
The labor force participation rate droppedto 62.8%. It has been hovering around that
level, the lowest since 1978, for most ofthe past year.