Detroit Free Press Susan Tompor column
Mar 09, 2013 (Detroit Free Press - McClatchy-Tribune Information Services via COMTEX) --
Talk about March Madness, the Dow is up and the jobless rate is down. Who had this Cinderella story plugged into their economic brackets
Granted, many still want to see the economy really gain some steam. But is it possible that the economic underdog will cut down more nets and go all the way
The national February jobs numbers proved to be better than expected when released Friday morning. The U.S. unemployment rate fell to 7.7% in February from 7.9% in January, as the country's economy added 236,000 jobs. Overall, private businesses added 246,000 jobs but 10,000 government jobs were lost.
The U.S. jobless rate is at a four-year low.
The Dow hasn't been this high in more than five years.
It closed at 14,397.07 on Friday, up 67.58 points. This week, the Dow broke the record close on Tuesday when the blue chip index closed at 14,253.77 points. It went on to set new records.
The power drink is housing.
"The real estate market is kicking into high gear," said Robert Johnson, director of economic analysis for Morningstar in Chicago.
Builders are handing out more paychecks, as construction hiring rose by 48,000 workers in February. It was the biggest surge in nearly six years. That construction rally accounted for 20% of the gain in total U.S. employment last month.
Robert A. Dye, chief economist of Dallas-based Comerica Bank, said Friday's labor data signaled more signs of economic recovery -- and may offer economic support to the federal budget cuts ahead.
"Job creation appears to be improving even as fiscal tightening increases," Dye said. "Ongoing moderate to strong job creation would nullify the downside drag of fiscal tightening."
Some economists predict continued gains ahead for construction jobs -- with one economist estimating that as many as 30,000 construction workers a month nationwide will find jobs in the next year.
Those who work pouring concrete and installing electrical wire have been particularly in demand.
"One month does not make a recovery, but the magnitude and distribution of job gains in February looks very healthy," Dye said in a report.
Many economists say the U.S. economy is likely to continue to grow, but it will grow slowly. That slow growth is predicted even with the good news lately on lower gas prices, a bump-up in home prices and a better outlook in manufacturing.
The economy may be gaining ground, economists say, but it's not likely to roar ahead.
"It's not going to put everybody back to work tomorrow," Johnson said.
Johnson noted that February's job gains are strong, but he also pointed out that warmer weather last February led to even-stronger job gains then.
So he cautioned that people shouldn't bank too much on February's jobs number.
"This is not some out-of-the-blue weirdo number that means we're going to have a 4% GDP tomorrow," Johnson said.
He, like many economists, see the U.S. economy growing closer to 2% to 2.5% in 2013, maybe a little better than last year.
Yes, it is true that one does not have to go far to find someone who is out of work or someone who is looking for a paycheck that could actually cover a middle-class lifestyle.
Yes, it's true that many people don't have a dime riding on stocks -- and the federal government is in a financial fix.
No, we're not going to storm the court quite yet over a few amazing shots. OK. But it's still good to see a scoreboard that shows the economy has a shot at winning back a few more jobs.
Contact Susan Tompor: 313-222-8876 or firstname.lastname@example.org
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