National Economic Outlook - November 2013

Written By:
Ingo Winzer, President

Local Market Monitor

It's difficult to know how much the government shutdown affected the jobs figures for October, which are mainly measured at mid-month. Government employees are counted as employed even if furloughed, and the loss of private sector jobs - from reduced government spending - is probably spread throughout the economy.

The number of jobs in October was up 1.7 percent from last year, continuing the pace of previous months. Jobs were up 3.5 percent in business services, 2.5 percent in retail trade, 3.4 percent at restaurants, 1.6 percent in healthcare and basically flat in manufacturing and government.

The relatively low growth in healthcare jobs is worrying because the sector is so large, with 20 million jobs. Early last year the rate of job creation in healthcare was 2.4 percent, at the start of this year it was 2.0 percent, and now it's 1.6 percent. Healthcare has been one of the few areas where people with low skills can find low-paid but stable jobs that allow them to become renters.

A different snapshot of the economy comes from GDP figures for the third quarter, which showed the economy growing at a 2.8 percent rate. Small but significant contributions were made by exports and by increased state and local spending, which we haven't seen for years.