Employers in U.S. Cutting Jobs, Hours, Signaling Slower Growth

[marmar]

from Bloomberg:



Employers in U.S. Cutting Jobs, Hours, Signaling Slower Growth

By Shobhana Chandra

Aug. 2 (Bloomberg) -- Employers in the U.S. fired workers in July for a seventh straight month and cut hours for remaining staff to a record low, signaling economic growth weakened at the start of the second half of the year.

Americans labored an average 33 hours and 36 minutes per week, six minutes less than in June and matching the shortest workweek since records began in 1964, the Labor Department said yesterday in Washington. The jobless rate jumped to 5.7 percent, the highest level in more than four years.

Combined with the drop in payrolls, the total number of hours worked in July declined by 0.4 percent, indicating the economy took a turn for the worse entering the third quarter. Businesses are broadening efforts to trim labor expenses as surging fuel bills hurt profits.

``Companies have already cut the fat and some muscle, and are now trimming hours,'' said Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York. The drop in hours ``is going to have a huge impact'' on growth.

Private employers cut 76,000 jobs in July while government hiring increased by 25,000. That brought the decline in total payrolls to 51,000, spanning transportation companies, retailers, manufacturers and temporary help agencies.

In terms of the impact on gross domestic product, every tenth of an hour drop in the workweek is equivalent to a loss of 300,000 to 350,000 jobs, LaVorgna estimated. He cut his third- quarter growth forecast to 0.7 percent at an annual rate, less than half his prior projection of 1.5 percent. ......(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=aikzb5JpxxvQ&refer=home

[magellan]

1. And the death spiral continues

Right down the crapper we go.

[Possumpoint]

2. It Will Be A Slow Trip

Between the Fed and Republican Government, everyone is willing to declare that large corporation are too big to let fail and big money is protected. It doesn't matter who or how they screwed up, no investigations will get to the top. The Stock Market will continue to claim we are on the road to recovery. Only problem is at some point it will get beyond control and no matter how much junk money they print nothing will save the house of cards.