According to a recent headline in Bloomberg, Stagnant August Hiring in U.S. May Signal Renewed Recession, the numbers don’t look promising.
The article quotes James Hamilton, an economics professor at the University of California, San Diego who has studied what has led to previous economic downturns in the United States. Hamilton warned:
“At this stage of the typical expansion we expect above-average growth and instead we are barely seeing any growth at all. We have to be more worried. Overall, the economy is in a delicate position and another shock could send us down.”
Julia Coronado, the chief economist for North America at BNP Paribas, also offered a grim forecast for the US economy. Predicting that the economy will drop at a 2 percent annual rate during the last quarter of 2011, she stated:
“September could mark the start of the slump. When there are no jobs and no income, there will not be a lot of spending either.”
With the latest job growth number at zero, it looks as though we might be in stall mode as Bloomberg states. The confrontation of the job numbers and the political rhetoric coming out of Washington and the White House are about to reach a critical stage. With the President supposedly putting a jobs program on the table this week in a major speech, we will see pretty quickly whether it has any chance of passing the deadlocked Congress or not.
A second dip in the construction industry will signal more unemployment as corporations sit on their cash and projects go on hold. About the best that we might see is a “mini-stimulus” program in the 300-500 billion dollar range, but not much will lead to solid jobs in the industry.
So, the economists are all playing Paul Revere and riding through the night shouting the alarm and the President is looking for a street lamp where he can lay out a plan to stop the slide before it becomes a second dip.
I wonder whether the fact that he is speaking opposite the opening night of professional football is an indication of the workability of a plan or just more rhetoric and politics as usual. Seems that politics as usual is taking our industry apart right now.
I have learned that business leaders hate uncertainty and right now we seem to be getting shovelfuls of uncertainty thrown our way.
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