Sunday, September 14, 2014
FAIRFIELD-SUISUN, CALIFORNIA
99 CENTS

US job growth eases but tops 200K for a 6th month

By
From page B6 | August 02, 2014 |

WASHINGTON — A sixth straight month of solid 200,000-plus job growth in July reinforced growing evidence that the U.S. economy is accelerating after five years of sluggish expansion.

Employers added 209,000 jobs last month. Though that was fewer than in the previous three months, the economy has now produced an average 244,000 jobs a month since February — the best six-month string in eight years.

At the same time, most economists think the pace of job growth isn’t enough to cause the Federal Reserve to speed up its timetable for raising interest rates. Most still think the Fed will start raising rates to ward off inflation around mid-2015.

The Labor Department’s jobs report Friday pointed to an economy that has bounced back with force after a grim start to the year and is expected to sustain its strength into 2015. Economists generally expect it to grow at a 3 percent annual rate in the second half of this year after expanding 4 percent in the second quarter. Consumer spending is rising, manufacturing is expanding rapidly and auto sales are up.

“There is no doubt that the economy and the labor market have been strengthening,” said Sung Won Sohn, an economist at California State University’s Smith School of Business. “People are rejoining the labor force. All these factors point to moderate, but sustained economic growth in 2014.”

Speaking with reporters Friday afternoon, President Barack Obama declared that the economy “is clearly getting stronger. … Our engines are revving a little bit louder.”

In an encouraging sign, more people without jobs have started to look for one — a shift that nudged up the unemployment rate in July to 6.2 percent from 6.1 percent. Most of those who began searching last month didn’t find jobs. But the increase suggests they’re more optimistic about their prospects. The jobless aren’t counted as unemployed unless they’re actively seeking work.

Still, Americans’ paychecks are barely growing. That gives the Fed leeway to keep its benchmark interest rate near zero without worrying so much about higher inflation.

Investors were unimpressed by Friday’s data. The Dow Jones industrial average fell 70 points and broader indexes also fell. The yield on the 10-year Treasury note dipped, suggesting less concern about a Fed rate increase.

In one encouraging sign, a higher proportion of July’s job gains were in higher-paying industries. That’s a shift from much of the recovery, which has been marked by outsized gains in lower-paying fields such as restaurants, retail and home health care aides.

Manufacturing added 28,000 jobs in July, the most in eight months. Construction added 22,000 and financial services 7,000, its fourth straight gain. Accounting, bookkeeping and computer networking jobs also showed gains. And architectural and engineering jobs jumped 8,800, the most since January 2007.

“This is particularly important for new college graduates as it suggests that the market for individuals with higher education is finally firming,” said Diane Swonk, chief economist at Mesirow Financial.

Job growth is pushing up wages in some sectors. But the increases haven’t been widespread.

Ted Toth, vice president of a factory in Pennsauken, New Jersey, that makes parts for satellite, radar and GPS systems, says he has four available jobs that pay from $20 to $32 an hour. But he hasn’t been able to find employees qualified to fill them.

His company, Rosenberger North America, raised wages 6 percent earlier this year to fend off efforts by competitors to poach its employees.

“Everybody’s stealing from each other,” he said.

As hiring has increased and more people have begun seeking work, the proportion of working-age adults who either have a job or are looking for one rose slightly in July from a 36-year low to 62.9 percent. It was the first increase in four months.

The number of unemployed rose 197,000 to 9.7 million. Nearly three-fourths of that increase represented people who resumed their job hunts after previously giving up. The number of people who were unemployed because they had been laid off actually declined in July.

The lack of significant pay increases for most Americans has been a factor hobbling the recovery. Higher pay is needed to fuel consumer spending, which makes up nearly 70 percent of economic activity.

In July, average hourly earnings ticked up just a penny to $24.45. That was just 2 percent more than it was 12 months earlier and was slightly below inflation of 2.1 percent. In a healthy economy, wages before inflation would rise 3.5 percent to 4 percent annually.

Pay has failed to accelerate in part because many Americans are still uncertain about the economy’s long-term health, said Mike Schenk, a senior economist at the Credit Union National Association.

Schenk expects wages to pick up once the unemployment rate falls to around 5.5 percent — a level at which some businesses will have to increase pay to keep workers and some employees will be more confident asking for a raise.

“People are still bruised,” Schenk said. “I don’t think they feel comfortable, generally speaking, walking in and asking for raises at this point.”

Many more people are either out of work or are underemployed than the unemployment rate indicates, economists note. That can also keep a lid on pay.

Richard Moody, chief economist at Regions Financial Corporation, notes that 7.5 million Americans who are working part time would like full-time work, up from 7.3 million in January. An additional 2.2 million have stopped searching but would take a job if it was available.

On top of the 9.7 million people the government counts as unemployed, an additional 9.7 million either want a job or would like more hours. Combined, the three categories make up an “underemployment” rate of 12.2 percent.

That “is still far above any level that could be considered normal in a healthy labor market,” Moody said.

Those are the figures that Federal Reserve policymakers were reviewing at a meeting this week, after which they concluded that “there remains significant underutilization of labor resources.”

The challenge for the Fed is timing when to raise short-term rates. If it moves too soon to raise rates, the Fed risks choking off early signs of rising wages. If it acts too late to raise them, it risks causing inflation to surge.

Zach Pandl, a strategist at the financial firm Columbia Management, expects the Fed to start raising rates next spring.

“Wages are a lagging indicator, always the last piece of the puzzle in a recovery,” Pandl said.

 

The Associated Press

The Associated Press

LEAVE A COMMENT

Discussion | No comments

The Daily Republic does not necessarily condone the comments here, nor does it review every post. Read our full policy

.

Solano News

The show goes on for American Canyon comic

By Amy Maginnis-Honey | From Page: C1

 
David Lew: Chuckles keep coming despite cancer battle

By Amy Maginnis-Honey | From Page: A1 | Gallery

 
Walk to End Alzheimer’s brings out supporters

By Susan Hiland | From Page: A3

Council candidate leads cleanup day, youth rally

By Susan Hiland | From Page: A3, 6 Comments | Gallery

 
How to help prevent sports-related eye injuries

By Betsey Campbell, MPH | From Page: C4

Birthday party brings writers, musicians in Fairfield

By Ryan McCarthy | From Page: A4 | Gallery

 
Beware of invading plant species

By Kathy Low | From Page: C4, 2 Comments

 
Vacaville Grad Nite needs volunteers

By Susan Hiland | From Page: A5

CHP announces senior driving class

By Susan Hiland | From Page: A5, 7 Comments

 
Solano drug court plans reunion

By Jess Sullivan | From Page: A5

 
Time to sell? Who can say with certainty?

By Bud Stevenson | From Page: B7

Nut Tree Airport to see runway work

By Barry Eberling | From Page: B7, 1 Comment | Gallery

 
Risk a key factor in investment decisions

By Mark Sievers | From Page: B8

 
County graduates complete basic training

By Nick DeCicco | From Page: B10

Suisun City police: Sept. 12, 2014

By Susan Hiland | From Page: A12

 
Fairfield police log: Sept. 12, 2014

By Susan Hiland | From Page: A12, 1 Comment

.

US / World

AP Enterprise: al-Qaida’s Syrian cell alarms US

By The Associated Press | From Page: A1

 
Football coach moves game for daughter’s wedding

By The Associated Press | From Page: C2

 
The old ways are no way for Army drill sergeants

By Mcclatchy-Tribune News Service | From Page: C6

Rescuers end ocean search for Navy fighter pilot

By The Associated Press | From Page: A6

 
2 homes destroyed in Northern California wildfire

By The Associated Press | From Page: A6

Feds chase treasure hunter turned fugitive

By The Associated Press | From Page: A7

 
Will Apple’s digital wallet kill the card swipe?

By The Associated Press | From Page: A10

Transgender girl crowned homecoming princess

By The Associated Press | From Page: A10

 
Man sues after losing 5 toes in Colorado jail

By The Associated Press | From Page: A10, 1 Comment

Syrians attacked in Lebanon after soldiers killed

By The Associated Press | From Page: A11

 
Ukraine government repels rebel attack on airport

By The Associated Press | From Page: A11

Pope urges world to shed apathy toward new threats

By The Associated Press | From Page: A11 | Gallery

 
.

Opinion

 
Just take care of it

By Letter to the Editor | From Page: A8, 12 Comments

 
Campaign signs mean little, really

By Glen Faison | From Page: A8, 4 Comments

Hold the line with Local 39

By Daily Republic | From Page: A8

 
Editorial Cartoons: Sept. 14, 2014

By Daily Republic staff | From Page: A8

Sound off for Sept. 14, 2014

By Daily Republic | From Page: A8

 
Know of any new taxes?

By Rod Keck | From Page: A9, 14 Comments

 
President a success or failure?

By Thomas Sowell | From Page: A9, 11 Comments

Scottish independence tied to national identity

By Megan Mcardle | From Page: A9

 
.

Living

Community Calendar: Sept. 14, 2014

By Susan Hiland | From Page: A2

 
Today in History: Sept. 14, 2014

By The Associated Press | From Page: A2

‘Tammi’ and I are getting serious, but her friends don’t like me

By Kathy Mitchell and Marcy Sugar | From Page: C4

 
Horoscopes: Sept. 14, 2014

By Holiday Mathis | From Page: C4

.

Entertainment

PUBLISHERS WEEKLY BEST-SELLERS

By The Associated Press | From Page: C7

 
Americans Ferris, Fowler on Booker Prize shortlist

By The Associated Press | From Page: C7

NASCAR’s Kenseth behind anti-bullying kids’ book

By The Associated Press | From Page: C7

 
TVGrid

By Daily Republic Syndicated Content | From Page: B11

.

Sports

Solano volleyball preview: Falcons look to repeat as BVC champs

By Paul Farmer | From Page: B1 | Gallery

 
49ers look for win against Bears in Levi’s opener

By The Associated Press | From Page: B1 | Gallery

Raiders’ Carr to make home debut vs. familiar foe

By The Associated Press | From Page: B1 | Gallery

 
Rodney walks in run in 10th to give A’s 3-2 win

By The Associated Press | From Page: B1 | Gallery

Mayweather remains unbeaten despite bite complaint

By The Associated Press | From Page: B2

 
Travis Bowl results

By Daily Republic | From Page: B3

Stars Recreation results

By Daily Republic | From Page: B3

 
Contador beats Froome to win Vuelta 20th stage

By The Associated Press | From Page: B3 | Gallery

DeJoria, Enders-Stevens top NHRA qualifying

By The Associated Press | From Page: B3

 
McIlroy, Horschel tied for Tour Championship lead

By The Associated Press | From Page: B4

No. 15 Stanford rebounds from loss, tops Army 35-0

By The Associated Press | From Page: B4 | Gallery

 
College football Top 25

By The Associated Press | From Page: B4

This date in sports history for Sunday, Sept. 14, 2014

By The Associated Press | From Page: B5

 
Sports on TV for Sunday, Sept. 14, 2013

By Paul Farmer | From Page: B5

Kyle Busch wins Trucks Series race

By The Associated Press | From Page: B6

 
Kevin Harvick wins again for JR Motorsports

By The Associated Press | From Page: B6

Where’s the tape? America responds to video

By The Associated Press | From Page: B6

 
Ambrose leaving NASCAR to return to Australia

By The Associated Press | From Page: B6

Gordon covets elusive 5th title as Chase begins

By The Associated Press | From Page: B6

 
Rice saga puts quiet Ravens owner in spotlight

By The Associated Press | From Page: B6

Peterson booked and released from Texas jail

By The Associated Press | From Page: B6

 
.

Business

Hackerspaces help techies turn ideas into reality

By The Associated Press | From Page: B7

 
On the money: Options abound for selling used mobile phones

By The Associated Press | From Page: B7

US threatened Yahoo with huge fine over emails

By The Associated Press | From Page: B8

 
Recalls this week: smoke alarms, generators

By The Associated Press | From Page: B12

Tech Tips: Sprint’s good rates come with a price

By The Associated Press | From Page: B12

 
Sponsors keep close watch on NFL investigation

By The Associated Press | From Page: B12

.

Obituaries

Patricia C. “Pat” Child

By Nancy Green | From Page: A4

 
Barbara J. McGee

By Nancy Green | From Page: A4

Olga Mae Schaffer Lilienthal

By Nancy Green | From Page: A4

 
Minnie Lee Dixon

By Susan Hiland | From Page: A4

.

Comics