The Economy Line: Rising Real Average Weekly Earnings

George W. Bush ^ | August 17, 2004

[RWR8189]

Real Average Weekly Earnings Increase.  "Easing inflation in July had the effect of pushing up inflation-adjusted earnings. Real average weekly earnings, which posted a big 0.8 percent drop in June, rose 0.7 percent last month, according to a separate Labor Department report."  ("Consumer Prices Drop, Housing Starts Soar," Reuters, 8/17/04)

Housing Starts Rebound Sharply In July.  "Housing starts rebounded sharply in July, making up almost all the ground lost in a June slump by posting their largest monthly percentage gain since September 2002, a report from the Commerce Department on Tuesday showed.  Starts rose a healthy 8.3 percent to a seasonally adjusted annual rate of 1.978 million units in July, above Wall Street expectations. June starts were revised slightly higher, to a 1.826 million annual rate from the initially reported 1.802 million pace."  ("Housing Starts Rebound Sharply In July," Reuters, 8/17/04)

July Consumer Prices Drop.  "U.S. consumer prices dropped in July for the first time in eight months as a sharp run up in energy costs reversed, the government said on Tuesday in a report showing underlying inflation pressures largely in check.  The consumer price index, the most widely used gauge of U.S. inflation, slid 0.1 percent in July, the Labor Department said. It was the first decline in consumer prices since a 0.2 percent drop in November."  ("July Consumer Prices Drop," Reuters, 8/17/04)

Industrial Production Higher In July.  "Industrial production increased 0.4 percent in July; output in June was revised down and is now estimated to have decreased 0.5 percent. ... In manufacturing, a production gain of 0.6 percent in July more than reversed the previous month's decline. Mining output also moved back up in July after a decline in June. At 116.2 percent of its 1997 average, industrial production in July was 4.9 percent above its level a year earlier."  ("Industrial Production And Capacity Utilization," Federal Reserve Statistical Release, http://www.federalreserve.gov/releases/G17/Current/default.htm, 8/17/04)

Jobs Numbers Likely To Be Revised Upwards.  "NFIB's small business job openings index made an upside breakout in July, making it even more likely that July's weak payroll employment estimate will eventually be revised up significantly, which wouldn't be that unusual.  During a 30 month stretch in 1992-1994, roughly where we are at in the current business cycle, payroll employment was initially reported below where it stands today 26 our of 30 times, and by an average of almost 100,000 per month.  10 months were revised up 140,000, or more." ("Summary," International Strategy And Investment: Economy, Money & Markets, 8/16/04, p. 2)

Jobs Market Is Stronger Than It Appears.  "President Bush's election hopes appeared to take a direct hit from the recent report showing jobs rose by just 32,000 in July. But look closely, and other data suggest the jobs market isn't as weak as it looks. … For there are many ways to understand what's going on in the job market. And, by most measures, things are quite strong right now -- especially when measured from a year ago. Take the unemployment rate. Over the past year, that rate has dropped steadily, from 6.2% to a current 5.5%. Or how about claims for jobless benefits at the state level, thought by many economists to be the best current indicator of the job market's strength? In the most recent week, claims averaged 339,000 on a four-week moving average basis -- way below the level of 400,000 and higher just a year ago."  ("What Jobs Slump?" Investor's Business Daily, 8/13/04)

Home Builder Confidence Jumps.  "The National Association of Home Builders said lower mortgage rates helped lift its gauge of builder confidence to 71 in August, up from 67 in July and the highest since October.  Readings above 50 signal optimism.  A gauge of single-family home sales rose two points to 76, while the outlook gauge rose to 78 from 74.  A reading on buyer traffic was the second best on record."  ("Home Builder Confidence Jumps," Investor's Business Daily, 8/17/04)

Auto Affordability Hits 25-Year High.  "Comerica Bank's gauge of auto affordability rose to a 25-year high in Q2, as a median family needed 20.6 weeks of income to buy an average price car, down from 21.1 weeks in Q1.  Median family income rose 1.6% in Q2, as the average price of a car, including financing, fell 0.8% from Q1 to $27, 126.  The annual 4% income gain easily outpaced the 1.6% rise in car prices."  ("Auto Affordability Hits 25-Year High," Investor's Business Daily, 8/17/04)

[trebb]

Little Tommy D. is deeply saddened.

Do ya think that he uses the "deeply" to offset the "shortly" set of genes/jeans he lives with?

[lelio]

showing jobs rose by just 32,000 in July. But look closely, and other data suggest the jobs market isn't as weak as it looks. … For there are many ways to understand what's going on in the job market.

Well that's one way to put lipstick on that pig. "Job creation doesn't matter ... X does!"

[rushmom]

All good news.

[RWR8189]

They then went on to give reasons why it is likely those numbers will be revised upwards.

I didn't see you comment on the net Birth/Death model this month...

[lelio]

I didn't see you comment on the net Birth/Death model this month...

Who need to comment about a number that flucates like this:

Jan	-321
Feb	115
Mar	153
Apr	270
May	195
Jun	182
Jul	-91

A 270k job swing from June to July? A 436k job swing from Jan to Feb?

As for the first time jobless claims, a lot of factors can go into that. For example, at least in WA state, people can't file for UI unless they've been employed for a year. Also temp job people can't file for unemployment.

[Right_in_Virginia]

BTTT

[WOSG]

PING - good economic news

FOLKS, This is great stuff to write in a letter to the editor:

Economy is doing great [ put in statistics - GDP up 4.8% and industrial production up 4.9% over the past 12 months, and productivity up an astonding 17% in the past 4 years]
The Bush tax cuts have worked.
Now, Kerry wants to reverse those - it will weaken our economy, and investors know this, so Kerry's poll numbers are fluctuating in inverse proportion to the stock market.

[WOSG]

that's not they said - strawman. they didnt say job creation wasnt important ... but the month saw the household survey add 600,000 jobs (!!!!) last month. ignore that?

Clearly, 4.8% growth and 1.5 million new jobs in the last 12 months, and a decline in unemployment so that it is now at 5.5% is a pretty darned GOOD record, and Bush administration has every right to crow about the strong economy.

The media keep talking down this strong economy with high productivity growth, low inflation, and significant industrial production growth, but it don't make it so.

[expat_panama]

[post #3]  "Job creation doesn't matter ... X does!"

Job creation is what we have-- big time.  The fact is that since Jan. '01 millions of people have entered the ranks of the employed.   As you put it, the spinners countered with "Job creation doesn't matter ... only the payroll total does!"  --and (like last month) when it increases, we hear "The payroll total increase doesn't matter ... only an  increase greater than what we have does!"

Sure there are lots of sourpusses at the DU who're unhappy- but most Americans know they're better off.

[Constitution Day]

Compare & contrast the following links, both posted at roughly the same time to our local TV news site:

Kerry Links N.C. Job Losses To Bush Tax Cuts, Indifference
http://www.wral.com/news/3669340/detail.html

N.C. Unemployment Rate Lowest In Three Years; National Leader In Job Gains
http://www.wral.com/news/3669372/detail.html

LOL!

[expat_panama]

Now that is priceless! 

Thanks Const.

[Constitution Day]

I just had to share that with someone!

Regards,
CD