The
data on Gross Domestic Product for the second quarter are as unenlightening as
always. The 2.1 percent annualized growth over the first quarter was a
combination of heavy consumer spending, cuts in company inventories, a drop in
exports, and strong government spending.
The
previous quarter it was poor consumer spending, higher
inventories, and higher exports. Go figure.
The
job data, on the other hand, are consistent with what we've been seeing for several
months: a slower rate of growth. Jobs in July were up 1.5 percent from a year
ago, the same as in May and June, and down from the 1.8 percent that prevailed
earlier this year. This isn't yet a cause for concern, but a further drop to
1.3 percent would be. We're at a point where there isn't much wiggle room.
Jobs
were up 2.5 percent in healthcare, 2.2 percent in business services, 2.1
percent at restaurants, 1.2 percent in finance and 1.2 percent in
manufacturing. Retail jobs were slightly down, government jobs slightly up.
Jobs
in construction were up 2.7 percent, which seems like a lot but isn't; last
year it was 4.8 percent. I have a strong suspicion that home builders in urban
markets concentrated on the upper end of the market and it's now softening.
