The Institute for Supply Management, an association of purchasing managers, reported Monday that its non-manufacturing index rose to an all-time high 63.7 last month from 55.3 in February. The old record of 60.9 was set in October 2018.
Last month, hiring strengthened across the economy. Restaurants, hotels and bars—the sector that was most damaged by the virus—added 216,000 jobs. Construction companies, aided by better weather after severe storms in February, gained 110,000.
After a year of epic job losses, waves of coronavirus infections, and small business closures, numerous trends are brightening the outlook.
The size of the drop surprised economists, although it is likely that there was significant disruption from severe winter storms that hit much of the country last month, on top of ongoing supply-chain problems.
The Federal Reserve foresees the economy accelerating quickly this year yet still expects to keep its benchmark interest rate pinned near zero through 2023, despite concerns in financial markets about potentially higher inflation.
The decline from the previous month came after retail sales jumped 7.6% in January as people spent $600 stimulus checks sent at the end of last year.
Over the past year, wholesale prices are up 2.8%, the largest 12-month gain at the wholesale level in more than two years.
Consumer prices are up 1.7% over the past year, a still moderate performance for inflation, which is running below the Federal Reserve’s 2% target for price increases.
A new poll finds COVID-19 has been devastating for some Americans, while leaving others virtually unscathed or even in better shape, at least when it comes to their finances.
Janet Yellen, the first woman to head the Federal Reserve and the U.S. Treasury Department, said “there is a cultural problem in the profession, and we need to change the culture.”
Kelly Tingle kept her job in internal communications at Cummins Inc. but had to adjust to working at home. Lisette Woloszyk lost her job at the JW Marriott but has since found a new one. Andrea Haydon started her own design firm after being laid off from Ratio Design. They talk with host Mason King about their anxieties, fears and hopes about the future.
Consumer borrowing is closely watched for indications about Americans’ willingness to take on more debt to finance their spending, which accounts for two-thirds of U.S. economic activity.
The pickup in hiring lowered the unemployment rate from 6.3% to 6.2%, the Labor Department said Friday in its monthly jobs report. That is down dramatically from the 14.8% jobless rate of April of last year, just after the virus erupted in the United States.
Economists have forecast that job growth reached 175,000 last month, according to data provider FactSet. That would mark a sharp improvement over an average of just 29,000 jobs a month from November through January.
Federal Reserve Chair Jerome Powell suggested Thursday that inflation will pick up in the coming months but the rise would likely prove temporary and not enough for the Fed to alter its record-low interest rate policies.
The revised figure released by the Labor Department on Thursday was slightly smaller than the 4.7% decline estimated a month ago. But it was still the biggest drop since the second quarter of 1981.
Reports on consumer spending and auto sales were mixed, while overall manufacturing showed moderate gains despite supply-side constraints, according to the Fed survey.
Friday’s report from the Commerce Department also showed that personal incomes, which provide the fuel for spending, jumped 10% last month, boosted by cash payments most Americans received from the government.
The 4.1% gain in the gross domestic product—the broadest measure of economic health—is a slight upward revision from 4% growth in the first estimate released a month ago, the Commerce Department reported Thursday.
Last week’s decline in applications was broad-based, with 36 states (including Indiana) and the District of Columbia reporting fewer people seeking unemployment benefits. That suggests that employers might be cutting fewer jobs.
