WSJ: A Big Burst of Hiring Appears Unlikely

[question everything]

A Big Burst of Hiring Appears Unlikely

By TIMOTHY AEPPEL
Staff Reporter of THE WALL STREET JOURNAL
February 14, 2005; Page A2

Productivity growth appears to be slowing in the U.S. after an unusual surge. Does that mean the pace of hiring is about to pick up significantly? Don't count on it.

Many companies have clearly stretched their existing work force as far as they can and will be adding more employees in the months ahead. But larger economic forces -- from the growing ability of companies to meet more domestic demand with production outside the country, to lingering anxiety about overexpansion, to further technological advances -- will curb the appetite for workers. There will be job growth, but it will be moderate, and disappointing to those waiting for a big burst.

(snip)

"Businesses have discovered just-in-time hiring, and that's not going to change," says Joel Naroff, chief economist at Naroff Economic Advisors Inc. in Holland, Pa. Mr. Naroff says uncertainty continues to play a big role in damping employers' appetite for workers and also is visible in the continuing dearth of investment in major expansions.

(snip)


But one reason job growth may continue to disappoint is that productivity isn't really expected to fall all that much when viewed over the longer term, which is really the best way to interpret the meaning of productivity anyway. Productivity numbers are prone to gyrations from quarter to quarter. Most economists predict that productivity growth will ultimately stabilize at between 2% and 2.5%. That would be well below the 4.1% growth logged last year or the 4.4% in 2003, but still extremely robust by historical standards.

And in manufacturing, the winds of productivity keep blowing strong -- ending any hope that this part of the economy will see a bounce in jobs. Manufacturing productivity grew a muscular 5.6% in the fourth quarter, up from 4.2% in the third. And sure enough, factories cut 25,000 jobs in January, according to the Labor Department, after shedding 7,000 in December. Rising manufacturing productivity has allowed the factory sector to produce more with fewer workers, but manufacturing is a shrinking source of jobs, and employment elsewhere in the economy has grown significantly.


(snip)

Write to Timothy Aeppel at [e-mail]

URL for this article:
http://online.wsj.com/article/0,,SB110833594089253469,00.html

[aikido15]

1. Feed the corporations and starve the workers...

How is this allowed to happen? I just don't get it.

[hatrack]

2. Gee, I wish I got paid to flog the Totally Obvious

Y'think?

[cthrumatrix]

3. it's all about greed ....look for more cuts and outsourcing

IMHO they are trying to bring down the US

[question everything]

5. What I don't understand is how housing prices keep going up

while rate of saving - surprise! - keeps going down

Where is middle American in all that? I would like to see some micro-data. Go to, yes, Alabama, and Texas, and Arizona and find out how do people make a living and what they think will happen to them when the income provider gets sick or die, or when they get to a ripe old age.

On Friday (I think) on the Today show a Realtor was talking about owning a house is really the social security of all of us. Certainly ours, but what about the ones who do not own a house? Or the ones who end up losing it when they lose their jobs, or who have to sell it to pay their medical bills?

[MissMarple]

6. Middle America will be in the poor house.

Is this all a charade, an exercise in incompetence, or are these people just too insulated from the results of their actions? As long as corporate profits support their insularity, I don't think they care about the American people at all. Maybe they all embrace theories promoting the end times, Calvinist extremism, or rugged Libertarianism.

[cliss]

7. An example:

Almost everyone I know is very proud and excited that their homes have gone up in value. They truly feel that they are "rich", and they made a smart investment that will be their "nest egg" to protect them in their old age.

This is in Oregon, where the housing market has been ridiculously overpriced for a long time.

My co-workers count how much money they've "made" on their house in the last year. One girl told me she calculated how much her home had gone up in value "by the day".

I just shrugged my shoulders. I thought to myself, "how long do you think this can go on, if our economy goes down the toilet?" If jobs are leaving the U.S., and unemployment keeps going up?

The real estate market is headed for a crash.

[Lindacooks]

13. I agree. Do you ever watch the HGTV show 'Designed to Sell'?

I don't know where it's taped, but I'm amazed every time they mention the value of the home at the beginning. These would be considered starter homes where I live (Minnesota), usually two bedroom, one bath, maybe about 1000 square feet, well under $200,000 - yet their value is usually touted at $500,000 and up (way up). That's insane, and you're right, it can't sustain itself.

[llmart]

14. Your house is only worth......

what you can sell it for when you get ready to sell it. Sometimes you do not sell at a time when it is up in value or when the market is good. It's also not worth much to you if you have very little equity. Your real estate agent's cut takes a bit out of your equity. Also, you have to remember that you are going to have to live in something, so you have to be a buyer (or renter) too.

Same goes for stocks.

[question everything]

17. Exactly right. But people think that the current values are high

and they take home equity loans and then when the prices drop, they owe more than they can get it for selling it.

[Colorado Blue]

23. Houses are NOT security if you can't pay the taxes or

if you don't have enough money for condo assessments or to fix the roof.

I fully expect a housing slump. Rents are already beginning to soften around here. If this happens - kaboom.

This "ownership" thing really bugs me. It's all about property while labor, endeavor, aren't compensated.

[nadinbrzezinski]

4. call me surprised, REALLY?

Good lord can we give the corporatist sons of bitches a clue? there is so far yuo can push the work force... even with the fear of loosing a job

[struggle4progress]

25. Who'd athunk it, given G. Wacko's brilliant history.

[VegasWolf]

8. Duh!! With a < 2% GDP and a negative trade balance. Wonder what

gave these geniuses a clue?

[PROGRESSIVE1]

9. With the MASSIVE twin deficits, I am expecting a...

siazable recession in 2007 which will start with a slowdown later this year into 2006!

Things are going to get bad with Bush!!!

[barb162]

11. why do you say the slowdown will be later this year...I think it'll start

around spring 2005 and then it will keep deepening and deepening

[RaleighNCDUer]

12. Which will be blamed on whoever the Dem is that will be elected

in 2008.

[barb162]

10. what has been totally incredibly obvious for a few yrs., these guys

are finally figuring out? All the previous glorious projections of new hiring and Bush's promises of 320,000 jobs a month (because of those fucking tax cuts) are not gonna come true?????

[llmart]

15. The Wall Street Journal.....

is a Republican whore newspaper. They only state the obvious after they realize the public already knows it.

[Anakin Skywalker]

16. Damn Right.

[question everything]

18. Actually the WSJ is a very good newspapers

with excellent writers. It's editorial page is a different matter.

And when something like that does appear in the WSJ - it gets the attention of many, and often get quoted all over the place.

[barb162]

20. yes, but the right wing economists have been constantly predicting

high job growth month after interminable month ("just wait till those Bush tax cuts kick in, you'll see some real job growth" blah, blah, blah, all that gets dutifully reported. And each month the job growth has been less than abysmal and the growth was mainly in areas of low pay jobs). The Bush disastrous tax cuts were the same as Reaganomics, Dave Stockman's supply side economics which clearly never worked. The WSJ writers knew IMHO this (the Bush plan) was the same kind of 1980s supply side plan and it didn't work in the 80s and wouldn't work now. Every time the pathetic job numbers come out, the WSJ reports it as "economists were disappointed with today's job numbers, expecting X job numbers." DId you ever notice how noone other than maybe Paul Krugman or Lou Dobbs ever has the cajones to say what's really going on...that the WSJ never could quite bring itself to say the obvious, that the Bush economics= Reaganomics and neither works. And that is not even getting to the other things messing up the economy now...shipping high paying jobs to Asia and elsewhere

[Redstone]

19. "A Big Burst of Hiring Appears Unlikely"

As does the possibility of pigs sprouting wings and flying.

Doesn't the WSJ have any NEWS to write about, or is their editorial policy now to just state the obvious?

Redstone

[Voltaire99]

22. Big Burst delayed. Big Bust coming.

Funny what one measly consonant can do to an economy.

[banana republican]

21. this is a DUH moment ... THE ELECTION IS OVER!!!!

lets get back to unemployment.....

[icehenge]

24. Simple question on Bush tax cuts

If Bush ever wants/has/or receives divine inspiration,
to reverse his wonderful hail marry tax cuts, what would
the likely outcome be for the economy and jobs?

More tightening of the belt around the pants by companies? Or no.?

[leesa]

26. No shit Sherlock! Do these guys get paid for this?