|
|
The Bureau of Labor Statistics reported Friday that the U.S. economy added 215,000 job in November – a number just slightly higher than economists had anticipated. With only 17,000 and 24,000 jobs added in September and October, respectively, as a result of Hurricanes Katrina and Rita, this November figures bring a welcomed boost to payroll employment, but is only considered “adequate” overall to the Department of Labor. Reflected in the growth are 11,000 jobs added in the manufacturing sector. This marked the second consecutive monthly increase in manufacturing – 15,000 jobs were created in October. Overall unemployment remained at 5 percent.
Economists say the manufacturing sector is expanding as companies invest in upgrading equipment and rebuilding depleted inventories. While overall manufacturing slowed in November after two fast-growing months, new levels continue to indicate that factories will fuel U.S. economic growth, which increased from July to September.
A private survey by the Institute for Supply Management (ISM) reported last week that its factory index dropped a point – from 59.1 to 58.1 – between October and November, but noted that readings above 50 indicate growth. As gas prices have retreated, manufacturing costs also have eased.
According to the Institute, a reading of 58.1 corresponds to 5.6 percent growth in gross domestic product. Seventeen industries reported growth in November, led by apparel, rubber and plastics and electronics, and also including industrial and commercial equipment and computers; chemicals; transportation and equipment; fabricated metals; and glass, stone and aggregate. ISM, based in Tempe, Ariz., surveys more than 400 companies in 20 industries to compile its index.
Economists suggest that growth in the industry in November may be due to hurricane-related restocking of building materials and construction equipment. While ISM reported that new orders gauge fell to 59.8 from 61.7 and order backlogs dropped to 53 from 55.5, economists says small slips are not a reason for concern and that the manufacturing industry remains on a growth path.
In addition to falling fuel prices – the national average today dropped to $2.12 from a high of $3.05 in September – Fuel Prices an increase in construction spending also may have contributed to manufacturing growth. Bloomberg reports that U.S. construction spending rose for a fourth straight month in October, led by homebuilding and commercial projects, according to the Commerce Department. Spending increased 0.7 percent to $1.13 trillion at an annual rate after a 0.2 percent increase in September.