January Job Report Statistics, Wage, Spending, Inflation, and China Changes
February 2, 2008 Leave a comment
Here are the job market and compensation numbers for January of 2008:
Net loss of 17,000 jobs in the month (revised to a loss of 76,000)
- If this number holds up in revisions, it is the first month to post a loss of jobs in four years
- December was revised up from 18,000 to 82,000
- Forecasters (economists) predicted a gain of 70,000 jobs
Unemployment rate moved to 4.9%
- Forecasters thought unemployment would remain at 5.0%
- The private sector only increased by 1,000 jobs in the month
Wages were up 0.2% for January
- Wages were up 3.7% for all of 2007, this is slower than inflation
- 2006 saw an increase in wage of 4.3%
- Inflation for 2007 was 4.1%, up from 2.5% in 2006
- Over the last 12 months, the salaried worker has in essence seen their pay decrease
- The number of hours employees work has declined from 33.8 to 33.7
- With the number of hours reduced and 4 cent increase in wages means that weekly wages dropped for the first time since April
$17.75 is the average hourly wage
Inflation:
- Inflation for 2007 was 4.1%, up from 2.5% in 2006
- This is higher than what the Fed would like to see – 1% to 2%
- Prices in December alone rose 3.5% from a year ago
Consumer Spending:
- December saw an increase in spending of 0.2%
- Adjusted for inflation, that is a flat month for spending
- November saw an increase of 1%
- New orders by business owners dropped to the lowest rate since May of 2003
- Personal income increased by only 0.5% in December
- Since December of 2006, disposable income (after tax salary and adjusted for inflation) has increased by 2.1%
The Chinese Impact:
- 7.5 of American spending on consumer goods is from China
- Chinese exports increased 2.4% over 2007, but that 2.4% creates a snowball effect where it increases the cost of everything else, from competitors goods, to the consumption of energy and food
- Chinese exports account for 80% of toys, 85% of footwear, and 40% of clothing
- Because of a combination of factors, the cost to American consumers for these items might increase by 10% this year
- The cost of certain types of plastic has risen by more than 30% – blame oil and its consumption
- The dollar is down about 7.6% against the yuan and can drop further in the next year
- Chinese factors don’t publish this number, but it is speculated by experts that wages in Chinese factories have increase 80% or more in certain parts of China
- The lowest month income for a factory worker is now $125 (in certain parts of China)
- Chinese factories for 2009 orders are increasing their prices by 20% to 50%
Other information:
The 2007 review by the government was completed in January and it found a drop in jobs by 191,000.
Recent Job Reports:
December 2007 Job Report Stats
November 2007 Job Report Stats
October 2007 Job Report Stats
September 2007 Job Report Stats