There is no arguing that President Trump has been very good for the American economy. And no matter how much Obama tries to take credit for it, it’s obvious that the trade and fiscal policies of the Trump administration are what is firing up our economic engine. And there doesn’t seem to be an end in sight.
Once again, Trump set fire to the Democrats overnight. The number of Americans filing for unemployment benefits fell to a nearly 49-year low last week, pointing to sustained labor market strength, which should continue to underpin economic growth. Initial claims for state unemployment benefits dropped 8,000 to a seasonally adjusted 207,000 for the week ended Sept. 29, the Labor Department said today.
The labor market is nearly at full capacity and is boosting wage growth all over the place. This, in turn, could boost consumer spending especially with the holidays approaching. And I have a feeling that Trump is not done bringing jobs and manufacturing back to America. There’s a lot more to be done there. Now, if we can just pay down our massive debt.
“Hurricane Florence, which hit North Carolina and South Carolina last month, affected claims, according to the Labor Department. The largest increases in initial claims for the week ending September 22 was in North Carolina. Claims in South Caroline rose by 2,830, the third largest rise behind Kentucky.
“Economists had forecast claims falling by 1,000 to 213,000 in the latest week. A year ago there were 265,000 new claims.
“Claims were new the recent low of 202,000, hit during the week ended September 15. That was the lowest level since November 1969.
“The previous week’s level was revised up by 1,000 from 214,000 to 215,000. The 4-week moving average, considered a more reliable gauge of the labor market because it smoothes out week to week volatility, rose to 207,000, an increase of 500 from the previous week’s revised average.
“The number of people receiving benefits after an initial week of aid fell 13,000 to 1.65 million for the week ended Sept. 22. Continuing claims are reported with a week delay. The four-week moving average of continuing claims fell by 15,250 to 1.66 million, the lowest level since October 1973.
“Jobless claims, which are a proxy for layoffs, have been closely watched for signs that trade disputes would be a drag on the labor market. Earlier this year, economists predicted that the steel and aluminum tariffs imposed by the Trump administration would cost 400,000 jobs. That prediction now looks way too pessimistic.
“The jobless claims data has no impact on the monthly employment report, which is scheduled for release on Friday. Bloomberg’s survey of economists sees nonfarm payrolls likely increased by 180,000 in September after rising 201,000 in August. The unemployment rate is expected to fall one-tenth of a percentage point to 3.8 percent, an 18-year low first hit in May.”
“The momentum in the labor market remains strong and we expect the unemployment rate to continue to decline,” said John Ryding, chief economist at RDQ Economics in New York.
The US markets did not fluctuate on the good news. Probably because it is already baked into that cake. Private companies are hiring more and private sector jobs are in demand once more. The Federal Reserve also raised interest rates last week for the third time this year and removed the reference to monetary policy remaining “accommodative.”
More from WSAU on other economic news:
“In a separate report on Thursday, the Commerce Department said new orders for U.S.-made goods recorded their biggest increase in nearly a year in August, but signs of weakness in business spending on equipment suggested manufacturing could be slowing.
“Factory goods orders surged 2.3 percent, the largest increase since September 2017, boosted by a surge in demand for aircraft, after falling 0.5 percent in July. Orders increased 8.6 percent on a year-on-year basis in August.
“Manufacturing, which accounts for about 12 percent of the U.S. economy, is being supported by robust domestic demand, but momentum is expected to gradually slow amid worker shortages, an increasingly bitter trade war between the United States and China, a strong dollar and moderating global growth.
“An Institute for Supply Management survey of manufacturers published on Tuesday showed factory activity retreated from a 14-year high in September.
“In August, orders for transportation equipment vaulted 13.1 percent, the largest gain since June 2017. That reflected a 69.1 percent surge in the volatile orders for civilian aircraft and parts. Orders for defense aircraft and parts soared 17.0 percent in August. Transportation orders fell 3.6 percent in July.
“Orders for motor vehicles rose 1.0 percent in August after increasing 1.6 percent in July. There were increases in orders for primary metals, fabricated metal products, and electronic equipment, appliances, and components. But orders for machinery and computers and electronic products fell.
“The Commerce Department also said August orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans, fell 0.9 percent instead of declining 0.5 percent as reported last month. Orders for these so-called core capital goods rose 1.5 percent in July.
“Shipments of core capital goods, which are used to calculate business equipment spending in the gross domestic product report, dropped 0.2 percent in August instead of rising 0.1 percent as reported last month.
“Core capital goods shipments increased 1.2 percent in July. Business spending on equipment slowed in the second quarter after growing robustly since the first quarter of 2017.”
What all of this means is that the economy is booming in a way it hasn’t done in decades. There are ebbs and flows in certain sectors, but overall, Trump is doing what they said couldn’t be done… making the US once again the strongest nation on the planet in every way including economically.