The gap in
fortunes between Europe and the United States widened this week after the
unemployment rate in the US tumbled while Italy suffered the humiliation of
another downgrade in its credit status. Most believe this to be a sign of a
comeback in our economy that we so much needed but what’s important at the
moment is to find out what has caused this positive increase for the United
States so we can keep rolling with the momentum.
Beating the expectations
of most analysts, the US economy added 236,000 new jobs in February as the
unemployment rate edged down to 7.7%, its lowest level since December of 2008.
The figures cheered US stock markets, with the Dow Jones Industrial Average
rising 67.58 points, or 0.5%, to 14,397.07, its sixth-straight daily gain, and
a new record high.
All of these
occurrences happen to be a sign that the US is slowly but surely making a
comeback to get where we need to be. February was the 29th consecutive month
that the US added jobs. On average, 183,000 jobs were added each month in 2012,
with about 195,000 a month on average in the past three months. The Bureau of
Labor Statistics said the job gains were made in professional and business
services, construction, and healthcare. In a sign of the improving housing
market, the construction industry added 48,000 in February. Since September,
construction employment has risen by 151,000.
Home prices are
also rising steadily, and banks are lending more. Such improvements suggest that
the economy is resilient enough to withstand the deep government cuts that will
kick in effect on friday. Sales of new homes jumped nearly 16 percent in
January to their highest level in 4 years, adding momentum to the housing
recovery. Consumer confidence rose in February after three months of declines.
And home prices increased in December from the same month in 2011 by the
largest amount in more than six years.
However, the
market is recovering from historic lows, and the January figure is still about
a third below the level of sales that was typical during the 1970s, 80s and
90s, before last decade's housing bubble. The number of permits issued for the
construction of new homes has hit a four-and-a-half-year high. Each new home
creates three construction jobs for a year on average. The construction
industry has added a total of 98,000 jobs since September.
What does this all
mean for the United States? It means that we are improving and we have some
sunshine in our forecast to look forward to. It’s not certain if this is a
positive complete turnaround but it’s something positive that we as a country have
been missing for quite awhile.
I think it is important to note these positive outcomes in the United States because many people tend to dwell on the downfalls on the country instead of figuring out what to do to improve the country. Your statistics were incredible showing how many jobs had been created each month this year (195,000 each month), especially in the home construction because I thought that area had decreased due to the real estate market values. Although our country has gone through many hardships it is important to keep the positives in mind and hope for a turn around overall.
ReplyDeleteThis news is critical to the United States because, we have a chance to receive our great economy back. It will boost the confidence of not only people in the business world and government but, the citizens at home. When they notice the shift in unemployment is down to 7.7% many Americans will become more motivated. Any person who was not working may feel excited about this increase and try and go find a job to help the country out even more. It is also really important that the stock market is going up and has had its sixth-straight daily gain. This is a positive look for the market to do better. More people will want to invest when the market is booming and now it is heading in that direction. It is important to have these positive moments because, it shows citizens that we as a country can pull through hardships and are ready for the future.
ReplyDeleteIt looks pretty bad for the US and even other countries; it shows that the US is in a critical state and our next move will be important since we've been shown a chance to change our economy. The US will start to slowly recover but we still have a long road to go, but hopefully people will be more confident in the economy. With the 7% unemployment that has been pretty low for a long while and since unemployment has been a big problem, this as well will add to the recovery, with all the jobs being created and the market slowly fixing it self and recovering the US is going to see change in the future, so these articles and facts show that a lot of things are going to change but it will still have obstacles along the way.
ReplyDeleteThe US economy is clearly improving from its devastating lows a few years ago, but there is something that we all must consider: How much higher can our economy get? Yes we have seen it go up and down throughout history, but it is said that soon enough it will have to level off and reach a point where It cannot get any higher. Another idea we must consider when thinking about unemployment rate is that it is going to get higher as the years go on. This we cannot avoid, because we have a growing population that our jobs cannot keep up with.
ReplyDeleteI think this post really shows that even though we hear about how bad our economic state has been the past couple years, we are really neglecting to mention the incline that the economy is slowly on. This is definitely a good sign for US citizens. But the news of Europes economic state is really sad. The Global Market as a whole, depends on every nation. Europe; being a large contributor is a vital part of the Global economy. This European recession could most definitely affect the US in future years.
ReplyDeleteYou have a superb outlook on this situation Tony and I strongly agree with you in that the economy has been slowly pulling itself out of this recession. We still have a while to go before we reach an optimal point in economy but progress is being made. With this steady progress could come a time very soon in which something could dramatically boost our economy out of this trough for good.
ReplyDelete