Retailers, consumers and prices
Check out the latest batch of grim data about the U.S. job market.
U.S. employment fell for the first time this year in June, renewing concerns about the strength of the U.S. economic recovery.
Weaker-than-expected private hiring and the end of thousands of temporary census jobs translated into a decline of 125,000 nonfarm payrolls, their largest fall since last October.
Analysts polled by Reuters had expected employment to fall 110,000 last month.
Private employment, often regarded as a better gauge of labor market health, rose only 83,000 in June, below market expectations for a 112,000 gain.
Retailers, wrestling with high labor costs and cautious American consumers, also seem to be playing safe while seeking new employees. Retail hiring fell 6,600 in June.
Sam’s Club, a division of Wal-Mart, will use a third-party company, Shopper Events , rather than its own staff to essentially hand out food samples or demonstrate electronics to passersby, allowing Sam’s Club to let go of about 10,000 mostly part-time workers. (Though they can apply for new jobs with Shopper Events.)
from Blogs Dashboard:
Check out the rise in the number of U.S. workers filing new claims for jobless benefits.
Hurt by layoffs in seasonal industries, the initial claims for state unemployment insurance rose 17,000 to a seasonally adjusted 474,000 in the week ended Dec. 5 from 457,000 in the prior week, the Labor Department said.
Check out a glimmer of hope on the employment front.
Planned layoffs for U.S. firms fell in April to their lowest levels since last October, according to a report from outplacement consultancy Challenger, Gray & Christmas.
Okay, layoffs are still at recessionary levels, with U.S. employers announcing plans to cut 132,590 jobs in April.
But CEO John Challenger says the fact that they are falling could mean that employers are a little more confident about future business conditions.
If employers start feeling more confident and stop laying off people, that could spur more confidence in employees and eventually get them to spend more at retailers, which, after all, is what this blog is about.
In a report by Discover, the credit card issuer, the number of consumers saying the economy was getting better was 23 percent in April. While that might not seem like much, it is still 8 percentage points better than in March.
Also, 51 percent of consumers said the economy was getting worse, down from 61 percent in March.
“Consumers continue to approach their spending with caution, albeit a little less so in April,” said Julie Loeger, senior vice president of brand and product management for Discover Financial Services. “As they grow more confident in the economy and their finances, consumers may boost their spending; which should help with an economic recovery.”
Are these the “green shoots” of an improving economy, or just optimism waiting to get shot down?
Also in the basket:
Carlsberg Q1 doubles on Eastern Europe gains, cost cuts
In Target tussle, a store becomes a battlefield (N.Y. Times)
Barneys aiming to close two stores (Wall Street Journal)
(Reuters photo of job fair)
On a scale of 0 to 100, where 100 is “very confident,” general economic perception of consumers fell to 36.7 in February from 38 in October, according to a survey by retail research firm NPD Group. The survey uses online answers from 1,000 people each month.
On the heels of worries over the economy, consumers’ intentions to shop also weakened. NPD’s study showed a more than five-point drop to 35.4 in February, compared to 40.7 in October.
Pilgrim’s Pride became the latest consumer-related company to cut jobs when it said on Friday that it plans to idle three U.S. plants because of an oversupply of chicken and weak consumer demand. The plants, in Georgia, Louisiana and Arkansas, employ about 3,000 people, or about 7 percent of the company’s U.S. workers.
The chicken producer, which is fighting to emerge from Chapter 11 bankruptcy protection, said the closings were needed to reduce production of low-value meat that is draining its finances.
Check out more than half a million more people looking for work.
The layoffs have been all over the news, but when you see them all added together it shows just how bad this economy is.
The economy shed a worse-thank-expected 598,000 jobs in December. That’s the worse one-month drop since Richard Nixon was president.
“The report is awful. it’s even worse than it looks, because people did not hire workers prior to Christmas, but they still did enormous layoffs after Christmas,” Cary Leahey, economist at Decision Economics.
Retailers shed 45,000 jobs in January and have cut 219,000 jobs since November as they went through the worst holiday shopping season in at least four decades.
And the hits just keep on coming. Macy’s cut another 7,000 jobs on Monday.
Where’s that stimulus again?
Also in the basket:
Tim Hortons, Cold Stone to wed doughnuts and ice cream
Hermes, LVMH bring relief to luxury sector
Amazon New York event spurs talk of new Kindle model
Reynolds American has given the Kool brand a demotion, moving it to what it calls a “support” brand – meaning it will actually get less support.
Check out more signs of consumers being put in a vise.
Personal income rose 0.1 percent in June, the Commerce Department said. That was the lowest rise since April 2007.
And in fact, if it were not for the economic stimulus checks some consumers received in June, disposable income would have shrunk, the department said.
Meanwhile, costs continued to rise. The personal consumption expenditures price index — an inflation gauge — rose at its highest year-over-year pace since May 1991.
Consumer spending rose 0.6 percent in June, but actually fell 0.2 percent accounting for inflation. So consumers are spending more to get less.
Oh, and one more thing on the gloomy economic front, Challenger, Gray & Christmas Inc said planned layoffs at U.S. companies rose 26 in July from June.
Also in the basket:
Retailer Boscov’s files bankruptcy, may be sold
Walgreen July same-store sales up
Burani says investor eyeing bid for 15-18 percent stake
Calvin Klein’s latest controversy (WWD)