National Economic Outlook - February 2016

National Economic Outlook - February 2016

Written By:
Ingo Winzer, President

Local Market Monitor

In the long run, the relative prosperity of a country depends on producing things that other countries want. Among the desirable things the US currently produces are food, complicated manufactured goods like airplanes, technological and scientific knowledge, and political stability. Technology and science have allowed the US economy to thrive but at the cost of concentrating income in fewer hands; technology and science are an elite specialty. As job-intensive manufacturing has moved off-shore, job opportunities for the majority of American workers are now confined to lower-pay service industries.

Since 2000, the US has added 10 million jobs, ALL in the service industries. This rapid shunting to lower-paid jobs indicates a permanent shift to lower-cost housing: smaller houses, more apartments, more single-family rentals.

Total jobs in January were up 1.9 percent from last year, following the trend of recent months. Jobs were up just 0.4 percent in manufacturing, but 2 percent in retail trade, 3.3 percent in business services, 3.3 percent in healthcare, and 3.6 percent at restaurants. Jobs in government were flat. Unemployment slid to 4.9 percent.

Somewhat ominously, the growth of jobs in transportation - mainly the movement of goods - has steadily fallen, from 5 percent a year a go to just 1.5 percent in January.