Jeremy Hobson: As the U.S. wakes up from holiday celebrations, the rest of the world is busy trying to stimulate a struggling economy. Central banks in Europe and China announced this morning they are cutting interest rates to spur lending. And the Bank of England announced this morning it is pumping another $78 billion into the economy.
All that ahead of the most important economic indicator of the month here in the U.S., which comes out tomorrow: the June employment report from the Labor Department.
Marketplace’s Mitchell Hartman tells us about some early clues that came in this morning.
Mitchell Hartman: First, layoffs. They hit a 13-month low in June.
John Challenger of outplacement firm Challenger Grey & Christmas says employers aren’t hiring very much, but they’re not firing a lot either.
John Challenger: And we’ve moved into a period where the economy is in kind of this slow growth mode, and employers are just standing pat.
Next, on to job creation. ADP, which tracks private payrolls, said this morning that companies added 176,000 new positions in June. That’s more than economists expected.
But Nariman Behravesh at IHS Global Insight is sticking with his lowball prediction for the Labor Department’s big unemployment report tomorrow.
Nariman Behravesh: We think it’s going to be stuck at 8.2 percent. I wouldn’t be surprised to see it drift up a little in the coming months. That’s consistent with a lackluster job situation. And if it goes down it’ll be typically for a bad reason in this environment, which is people dropping out of the labor force as they stop looking for work.
In the past three months, the U.S. economy has not created enough jobs to keep up with new workers entering the labor force.
I’m Mitchell Hartman for Marketplace.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.