Good and Bad Economic News

The Bad

FedEx just reported an excellent 18 percent increase in revenue over last year, but announced 1,700 job cuts, in spite of expectations of global growth over the coming year, according to reports. They will also close 100 facilities as it consolidates business divisions. The pace of job cut announcements has slowed considerably over last year, according to data released by outplacement firm, Challenger Gray & Christmas. Transportation companies have announced 20,102 job cuts through August, compared to 65,591 in the same period last year.

The Good

Jobless claims fell last week to 450,000, the lowest in two months. This marks the third consecutive decline for the historically volatile employment measure. Meanwhile, Toys R Us announced that it will open 600 temporary “Express” stores in malls and other shopping centers across the country for the holidays. This doubles the retailer’s 2009 holiday store openings and requires hiring 10,000 seasonal workers.

The Confusing

Much has been made of the jobless claims numbers from earlier in September. The short sound bites put out by some media outlets have been mostly incomplete and at times outright deceiving. It amazes me how little some media outlets respect their viewers and apparently believe that they can fool most of their viewers most of the time and some of their viewers all of the time and that the disservice they do to their viewers won’t come back to haunt them. In any case, corporate hiring in July was up and overall hiring was down. What caused that? The massive layoffs of a couple hundred thousand temporary workers hired by the U.S. Census Bureau. Any smart analyst would have discounted both the hiring and termination of these workers as there are so many of them and the jobs aren’t even seasonal like construction jobs can be due to the fact that the census is conducted only once a decade. So the boost the hirings gave during the winter and the slump the terminations gave this past summer shouldn’t be looked at when trying to determine if the job market is improving or weakening.