Engineering News

Reports show jobs market in solid shape
Thu Aug 25, 2005 01:19 PM ET

CHICAGO (Reuters) - U.S. job creation remains healthy even as record energy prices stir worries about a slowdown in hiring in some sectors, reports showed on Thursday.

Separately, a Federal Reserve report showed factory output in the U.S. Midwest edged higher in July despite lower production of autos.

Help-wanted ads in 51 major newspapers across the country edged up in July, according the Conference Board, a private research group. The help-wanted index rose to 39 from 38 in June and was the highest since April.

The report was consistent with the July payrolls report issued earlier this month showing 207,000 non-farm jobs were added.

"This modest rise in July may reflect the firm July payroll rather than being a signal for August," said David Sloan, analyst at 4CAST Ltd. in New York.

Financial markets showed little response to the report, partly because help-wanted ads in newspapers are seen as an outdated measure.

Ten-year Treasury note yields were at 4.18 percent, up from 4.17 percent on Wednesday, and the stock market was marginally higher as crude oil prices retreated.

"Because of the dramatic shift in job advertising market share from newspapers to the Internet, the help-wanted index has lost much of its luster," said Steven Wood, economist at Insight Economics.

The Conference Board recently added a help-wanted series tracking job ads on some 1,200 major and niche Internet job boards. The traditional help-wanted index dates back to 1951.

There were 1.97 million jobs advertised online in July, down from just over 2 million in June and May but up from about 1.8 million in April, the group said.

The dip in new online ad postings largely reflected the July 4th holiday week, when advertising volume was lower than during the last three weeks of the month.

Sloan said the history of the online help-wanted series is "still too brief to be useful."

Earlier, the Labor Department said the number of Americans making new claims for jobless benefits fell by 4,000 last week.

Initial claims fell to 315,000 in the week ended Aug. 20 from an upwardly revised 319,000 and was far below the 342,000 logged for the same period a year earlier.

"New and continuing claims are at levels that historically have been associated with payroll employment gains of around 225,000. Labor markets are gradually improving," said Wood.

This week's report corresponds in timing with the survey period for the August unemployment report.

On Wednesday, Chicago Federal Reserve President Michael Moskow said the U.S. jobless rate may not fall below its current 5.0 percent on a sustained basis.

The four-week moving average of new claims, which smooths out weekly volatility, rose to 315,000 from 313,750.

The number of people who remained on the benefit rolls after drawing an initial week of compensation fell 9,000 to 2.58 million in the week ended Aug. 13, the latest week for which data are available.

The four-week moving average fell to 2.58 million, the lowest since March 2001.

The Chicago Fed's Midwest factory index rose 0.1 percent in July and was up 2.7 percent from a year ago, trailing the 2.9 percent advance in national industrial output.

Production in the Fed's seventh district, which includes Illinois, Indiana, Iowa, Michigan and Wisconsin, has trailed the national factory index since 2001.

Regional steel and machinery output jumped in July while auto production fell 1.5 percent.

U.S. automakers have aggressively discounted prices this summer to move excess car and truck inventories, a move that pushed July auto sales up sharply.

On Thursday General Motors Corp. said it would extend the discount program -- under which it sells new vehicles to the public at the same price a GM employee would pay -- through Sept. 30, more than three weeks longer than previously announced. Rivals Ford Motor Co. and Chrysler are likely to follow GM's lead and prolong their own discount programs. (Additional reporting by Nancy Waitz in Washington, Meredith Davis in New York)

Source: Reuters

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