Good Enough For Now

Last week we heard about employment, and it looks okay.

Last week’s employment report had loads of data, almost all of it good news. Temporary employment continues to grow. Manufacturing payrolls are going up. Hours are going up. These are all leading elements of the employment picture, for obvious reasons: when things pick up in an economy, employers increase hours and add to temp staff before they add permanent workers. And manufacturing employment is more economically sensitive.

Yes, state government employment decreased—that’s normal. States feel the economic crunch later than the rest of us. It takes a while for lower tax receipts to wind their way through the system. But a tough economy eventually means budget cuts, and anyone surprised by this simply hasn’t been paying attention.

But even if states and towns are laying people off, private employers are hiring—about 70 thousand last month, when all the adjustments are made—and that’s a good thing. A year ago we were shedding 700 thousand jobs a month, and now companies are hiring. Any way you look at it, that’s progress.

Douglas R. Tengdin, CFA
Chief Investment Officer
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