Jobless Claims Fall For 4th Week In A Row: 6 Staffing Picks
Zacks Investment Research | Jun 22, 2018 08:50AM ET
Americans filing for unemployment benefits declined for the fourth week at a stretch in mid-June. Latest U.S. Labor Department data revealed that seasonally adjusted jobless claims for the week ended Jun 16 declined 3,000 from the prior weeks adjusted level to 218,000. The four-week moving average that evens out the sharp fluctuations in weekly reports declined 4,000 from the previous week’s revised average to 221,000.
Hiring Accelerated to Meet Growth
The manufacturing sector is currently solid with Purchasing Managers' Index (PMI), measured by Institute for Supply Management (ISM), touching 58.7% in May, up 1.4% from the April figure. The sector recorded growth for the 21st consecutive month, driven by continued increase in new orders, production activity and employment.
The service sector is the bellwether of the U.S. economy, employing around eight out of 10 workers. The ISM non-manufacturing index (NMI) was 58.6% in May, recording the 100th consecutive month of expansion. The Non-Manufacturing Business Activity Index reached 61.3%, growing for the 106th consecutive month.
To meet such growth, hiring is accelerating. Non-farm payrolls climbed by 2,23,000 jobs last month after rising 1,64,000 last April, meaning that the economy has now added jobs for 92 months in a row.
Job Openings at an All-Time High
In April, job openings climbed to the highest level since the Department of Labor started recording data on this metric. The figure was 6.7 million, up from 6.6 million in March. The number of unemployed people per vacancy plummeted to 0.9 from 1.0 in March, meaning that companies are keen on hiring workers even as the economy enjoys a nine-year long growth phase after the Great Recession.
Despite the 18-year low jobless rate, a tight labor market is compelling companies to pay higher. Average hourly earnings in May increased 8 cents to $28.92, registering 2.7% year-over-year increase, higher than 2.6% witnessed in April.
Growth Likely to Continue
The Conference Board’s Employment Trends Index was 107.69 in May, registering year-over- year growth of 3.9%. Although slightly down from the April figure of 108.00, the index is expected to grow through the year.
Gad Levanon, Chief Economist, at the Conference Board said that “the decline in the Employment Trends Index in May is probably a reversion to trend after the very rapid increases in recent months.” He added that “with the economy growing well above trend, we expect solid job growth to continue despite the difficulty in filling job openings.”
6 Solid Picks
The latest job numbers bode well for staffing companies. The buoyancy in the staffing space is further confirmed by its Original post
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