{"id":754,"date":"2016-06-01T14:33:22","date_gmt":"2016-06-01T18:33:22","guid":{"rendered":"http:\/\/naroffeconomics.com\/?p=754"},"modified":"2016-06-01T14:33:22","modified_gmt":"2016-06-01T18:33:22","slug":"may-supply-managers-manufacturing-survey-help-wanted-online-and-april-construction","status":"publish","type":"post","link":"https:\/\/naroffeconomics.com\/?p=754","title":{"rendered":"May Supply Managers\u00e2\u20ac\u2122 Manufacturing Survey, Help Wanted OnLine and April Construction"},"content":{"rendered":"

KEY DATA:<\/u><\/strong> ISM (Manufacturing): +0.5 point; Orders: -0.1 point; Employment: 0\/ HWOL: -285,800\/ Construction: -1.8%<\/p>\n

IN A NUTSHELL:<\/u><\/strong> \u00e2\u20ac\u0153If some members of the Fed were looking for weakness to hang their no-rate hike hats on, today\u00e2\u20ac\u2122s numbers should suffice.\u00e2\u20ac\u009d<\/em><\/strong><\/p>\n

WHAT IT MEANS:<\/u><\/strong> Things were looking up for the economy, at least when the April data were coming out. But May is a new month and maybe not a great one. The Institute for Supply Management\u00e2\u20ac\u2122s Index of Manufacturing rose nicely over the month, but this was one of those look at the details not the headline number.<\/em><\/strong> Yes, the sector picked up some steam in May, but it is not clear if that is sustainable. New orders grew decently, but not quite as rapidly as in April, while production slowed appreciably.<\/em><\/strong> As a result, hiring was flat and thinning order books don\u00e2\u20ac\u2122t argue for stronger output going forward. <\/em><\/strong> In other words, let\u00e2\u20ac\u2122s wait and see where this sector is going.<\/p>\n

On the labor market front, conditions may be softening. The Conference Board\u00e2\u20ac\u2122s Help Wanted OnLine measure tanked in May after having been largely flat in March and April.<\/em><\/strong> You have to go back to January 2014 to find a level of want ads this low. The fall off in demand for workers was spread across the country<\/em><\/strong> as every region reported a decline. Only 1 (Seattle-Tacoma) of the 52 largest metro areas saw labor demand increase. With ads dropping, the gap between demand and supply, as measured by the number of unemployed, narrowed.<\/p>\n

Construction activity nosedived in April. There were declines in residential and nonresidential activity as well as public and private construction. <\/em><\/strong> There were few categories that were up, making this a pretty ugly report.<\/p>\n

MARKETS AND FED POLICY IMPLICATIONS:<\/u><\/strong> Today\u00e2\u20ac\u2122s numbers don\u00e2\u20ac\u2122t provide the foundation for the Fed to raise rate in two weeks. But today\u00e2\u20ac\u2122s numbers will be overshadowed by Friday\u00e2\u20ac\u2122s employment report.<\/em><\/strong> After the more modest April gain, the consensus has moved down to the 150,000 to 175,000 range<\/em><\/strong>, especially given the potential of job losses due to the Verizon strike. That will be factored into any detailed discussion. The help wanted numbers seem to support a number in that range and possibly toward the lower end of it.<\/em><\/strong> The unemployment rate is expected to decline and if that happens, the focus will shift to the hourly wage number. The year-over-year increase has been accelerating and if that continues, it would be a warning that even more modest job gains are enough to put pressure on the labor markets.<\/em><\/strong> The economy is not booming; that is obvious. However, consumers seem to be spending but businesses are once again moving to the sidelines<\/em><\/strong>. Maybe it’s the uncertainty about the Fed or the presidential election, but if CEOs don\u00e2\u20ac\u2122t want to hire or invest strongly, it is going to be hard to get the economy to accelerate. <\/em><\/strong>The Fed needs to get its communications straightened out because it is creating more bad than good and it will be interesting to see what Fed Chair Yellen has to say on at her press conference on June 15th<\/sup>.<\/p>\n","protected":false},"excerpt":{"rendered":"

KEY DATA: ISM (Manufacturing): +0.5 point; Orders: -0.1 point; Employment: 0\/ HWOL: -285,800\/ Construction: -1.8% IN A NUTSHELL: \u00e2\u20ac\u0153If some members of the Fed were looking for weakness to hang their no-rate hike hats on, today\u00e2\u20ac\u2122s numbers should suffice.\u00e2\u20ac\u009d WHAT IT MEANS: Things were looking up for the economy, at least when the April data … Continue reading May Supply Managers\u00e2\u20ac\u2122 Manufacturing Survey, Help Wanted OnLine and April Construction<\/span> →<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-754","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/754","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=754"}],"version-history":[{"count":1,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/754\/revisions"}],"predecessor-version":[{"id":755,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/754\/revisions\/755"}],"wp:attachment":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=754"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=754"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=754"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}