Business Is Back

Baltimore-area home sales jump 35% in April

Mon, 10 May 2010 11:48:00 GMT

Home sales in Greater Baltimore jumped more than 35 percent in April, the last month for homebuyers to cash in on federal tax credits.

For the month, 2,205 homes sold in April, according to Rockville-based home sales tracker Metropolitan Regional Information Systems Inc. That’s up from 1,632 homes in April 2009 and from 1,800 home sold in March 2010.

“We are pleased to see signs of recovery within the mid-Atlantic region,” David Charron, CEO of MRIS, said in a statement.

The federal tax credit program that gave first-time homebuyers $8,000 and existing homeowners $6,500 expired in April.

As the Baltimore Business Journal reported April 30, real estate experts predicted the final month for the stimulus-funded program would help drive more hopeful homeowners to the closing table. The question going forward, they say, is whether those were sales that would otherwise have taken place in the months to come.

April was also the first month in more than a year that home prices gained ground, albeit marginally, The median sale price in April was $235,000, up 2 percent from $229,925 in March and barely from $234,950 in April 2009. The average amount of time a home spent on the market fell 11 percent year-over-year to 113 days

The data includes Baltimore City, Anne Arundel, Baltimore, Carroll, Harford and Howard counties.

Harford County posted the highest year-over-year increase in regional sales. For the month, 245 homes sold in the county, up 78 percent from April 2009. The median sold price fell by a percent there to $227,557, down from $230,000 in April 2009.

In Baltimore City, 487 homes sold, up 24.5 percent from a year ago, and the median sold price increased 16.8 percent to $134,900. In Howard County, sales increased to 252 homes, up 22.9 percent from April 2009, and the median sold price fell nearly 3 percent to $339,500.

Source >>

U.S. Economy: Payrolls Jump by Most in Four Years

Fri, 07 May 2010 11:27:00 GMT

May 7 (Bloomberg) -- Payrolls in the U.S. surged by the most in four years in April, led by gains in private employment that indicate the economy is weaning itself from government support.

The 290,000 increase in employment exceeded the median estimate of economists surveyed by Bloomberg News and followed a 230,000 gain in March that was larger than initially estimated. The jobless rate rose to 9.9 percent from 9.7 percent as thousands of jobseekers entered the workforce, a Labor Department report in Washington showed today.

The dollar rallied as private employers added 231,000 workers across the economy, from manufacturing and construction to services. Companies including General Electric Co. and Berkshire Hathaway Inc. are adding staff in response to growing sales, indicating gains in consumer spending may spur more hiring.

“Job growth like this is going to sustain the recovery going forward and certainly help sustain the U.S. consumer,” said John Silvia, chief economist at Wells Fargo Securities LLC in Charlotte, North Carolina. “Businesses are coming to the conclusion that there is a sustained economic recovery.”

The dollar rose as much as 2.9 percent, the biggest intraday move since February 2009, to 93.22 yen before trading at 91.76 yen at 11:17 a.m. in New York, from 90.58 yen yesterday.

The Dow Jones Industrial Average rose less than 0.1 percent to 10,525.01 in New York after plunging 3.2 percent yesterday on concerns the Greek debt crisis may spread.

U.S. and Greece

The improving economic data is one reason the Greek crisis is unlikely to derail the U.S. recovery, according to economists including James O’Sullivan. “Strength in growth is translating into a pickup in the labor market, which makes the recovery more self-sustaining,” said O’Sullivan, global chief economist at MF Global Ltd. in New York. “The strong upward momentum in the data through April should help absorb whatever drag comes from the turmoil in Europe.”

Manufacturers added the most workers to payrolls since August 1998, employment at service providers showed the biggest gain since November 2006 and construction companies hired for a second straight month. The gain in overall employment in April was the biggest since March 2006.

“These numbers are particularly heartening when you consider where we were a year ago, with an economy in freefall,” President Barack Obama said. Still, “it’s going to take time to repair and rebuild” the damage from the recession and the financial crisis, he said at the White House.

GE Adding Workers

GE, the world’s largest maker of jet engines, power- generation equipment and locomotives, increased the number of jobs it plans to add in Michigan to more than 1,300 with the creation of about 220 aerospace manufacturing positions, the Fairfield, Connecticut-based company said this week.

Overall payrolls were forecast to increase by 190,000 after a previously reported March gain of 162,000, according to the median estimate of 84 economists surveyed by Bloomberg. Estimates ranged from gains of 75,000 to 300,000.

The April gain included 66,000 temporary workers hired by the government to help conduct the 2010 census and a 231,000 rise in private payrolls.

“The hiring process has begun in the U.S.,” said Stefane Marion, chief economist at National Bank Financial Inc. in Montreal, who forecast a payrolls gain of 280,000. “It’s a very encouraging outlook for the U.S. We expect the job creation to continue in the coming months.”

Entering Workforce

The jobless rate was projected to hold at 9.7 percent. Forecasts ranged from 9.5 percent to 9.8 percent. The unemployment rate rose as more people entered the workforce. The figures showed an 805,000 increase in the civilian labor force and a 550,000 gain in employment.

The unemployment rate may stay high as more people enter the labor force in search of work, one reason why the Federal Reserve is likely to keep its benchmark interest rate at a record low.

The gain in private payrolls was the fourth in a row and followed a 174,000 increase in March that may have reflected, in part, a weather-related rebound from the prior month. Private employment was projected to climb by 100,000, according to the median of 25 forecasts.

Census Hiring

A government boost to hiring is already under way at the Census Bureau. The agency said it will take on about 970,000 temporary workers from April through June to conduct the population count that occurs every 10 years.

The government program may have the biggest impact on payroll figures in April and May, when the bulk of the hiring will take place, and will then subtract from the job count the following months as employees are dismissed after the work is done.

For that reason, economists will be excluding workers on public payrolls for much of the rest of the year in gauging the state of the labor market.

Government payrolls increased by 59,000 in April. State and local governments reduced employment by 6,000 during the month, and the federal government added 65,000.

Hourly Earnings

While the economy added jobs, incomes were little changed. Average hourly earnings rose to $22.47 in April from $22.46 in March, today’s report showed.

The average work week for all workers rose to 34.1 hours in April, the highest since January 2009, from 34 hours the prior month.

The so-called underemployment rate -- which includes part- time workers who’d prefer a full-time position and people who want work but have given up looking -- increased to 17.1 percent from 16.9 percent.

The report also showed an increase in long-term unemployed Americans. The number of people unemployed for 27 weeks or more rose as a percentage of all jobless, to a record 45.9 percent.

Factory payrolls surged 44,000 in April after rising 19,000 in the prior month. The median forecast by economists in the Bloomberg survey called for a gain of 20,000.

Payrolls at builders increased 14,000 last month after gaining 26,000.

Service providers added 225,000 workers after an increase of 175,000 in March.

The number of temporary workers increased 26,200 in April. Payrolls at temporary-help agencies often turn up before total employment because companies prefer to see a steady increase in demand before taking on permanent staff.

Billionaire Warren Buffett, whose Berkshire Hathaway cut more than 20,000 jobs last year, said his Omaha, Nebraska-based company is now adding staff as the economic recovery boosts demand at its industrial units.

“We do hire people when we have something for them to do,” Buffett told investors last week in Omaha, Nebraska, where Berkshire held its annual shareholders’ meeting. “We are a net hirer now.”

Source >>

Private sector jobs rise for first time since 2008

Wed, 05 May 2010 14:47:00 GMT

(Reuters) - Signs of a recovery in the U.S. labor market grew on Wednesday as reports showed job growth among private companies and plans for layoffs falling to their lowest levels in four years.

The private sector added 32,000 jobs in April, according to the report by payrolls processor ADP Employer Services. Economists had expected a rise of 30,000 jobs, based on a Reuters poll.

The data comes two days before a closely watched U.S. payrolls report, which is expected to show a second straight month of job gains.

"Private sector employment growth is another encouraging sign the labor market is turning the corner and the last pillar of the recovery looks to be now in place," said Zach Pandl, economist at Nomura Securities International in New York.

Other data on Wednesday showed the pace of growth in the U.S. services sector was unchanged in April compared with March and expanded below the rate forecast by analysts.

The Institute for Supply Management report's employment component fell slightly to 49.5 from 49.8 the prior month.

The February and March private sector ADP figures were revised to show gains instead of losses. The last time the private sector registered job gains was in January 2008, according to ADP.

The private sector jobs data could have little impact on forecasts for Friday's payrolls, which are likely to show gains from the addition of U.S. census workers, said Joseph Lavorgna, senior economist at Deutsche Bank in New York.

The report "doesn't preclude us from having a 200,000-plus number on Friday," he said.

Recent data has pointed to strength in the economic recovery but unemployment remains high, at 9.7 percent, and is expected to stay at that level in April.

The U.S. government's monthly jobs report is expected to show nonfarm payrolls increased by 200,000 in April, adding to March's 162,000 gain, according to Reuters forecasts.

Temporary jobs to conduct counts for the census, held every 10 years, will likely account for the bulk of the April gain, with private sector hiring expected to pull back from March's spectacular 123,000 increase.

U.S. stock prices declined, while U.S. Treasury yields fell and the euro fell against the U.S. dollar after the data was published, as Greece's debt problems continued to weigh on investors.

"Any job growth here is encouraging but not big enough for the markets to shift away their focus on issues like Greece and deficits," said Subodh Kumar, chief investment strategist at Subodh Kumar & Associates in Toronto.

The ADP report, jointly developed with Macroeconomic Advisers LLC, showed the March figure was revised to show a gain of 19,000 from an originally reported fall of 23,000, and a rise of 3,000 for February.

"Employment has turned the corner in total and is moving up and has been for several months now, but gains so far remain muted," said Macroeconomic Advisers LLC chairman Joel Prakken.

The ISM's services index held at 55.4 in April from March, below the 56.0 median forecast of 74 economists surveyed by Reuters. A reading above 50 indicates expansion.

Employers announced 38,326 planned job cuts last month, the lowest number of layoffs since July 2006 and down from 67,611 planned job cuts in March, outplacement consultants Challenger, Gray & Christmas said in a report.

Adding to the day's upbeat economic news, Mortgage Bankers Association data showed demand for loans to buy U.S. homes hit a seven-month high last week.

Home purchase loan applications jumped 13 percent in the week ended April 30 to the highest since early October, overshadowing a 2.1 percent drop in demand to refinance loans. Total mortgage applications rose by a seasonally adjusted 4 percent, the trade group reported.

Source >>

Factory orders strengthen, home sales contracts up

Tue, 04 May 2010 15:41:00 GMT

WASHINGTON – A surprisingly busy month for U.S. factories and a surge in home buying are the latest signs that the economic recovery is picking up.

Orders to U.S. factories rose 1.3 percent in March, the Commerce Department said Tuesday. That was much better than the 0.1 percent decline analysts had expected. Excluding the volatile transportation sector, orders gained 3.1 percent, the biggest increase since August 2005.

Widespread activity in many industries offset a big drop in commercial aircraft. The increase offers further evidence that U.S. manufacturers are helping drive the recovery.

A separate report showed that more people signed contracts on previously owned homes in March than was expected. The jump was in large part the result of tax incentives that have propelled the housing market this spring.

The National Association of Realtors said its seasonally adjusted index of sales agreements for previously occupied homes rose 5.3 percent from a month earlier to a reading of 102.9. It was the highest level since October and a 21 percent increase from the same month a year earlier. The index provides an early measurement of sales activity because there is usually a one- to two- month lag between a sales contract and a completed deal.

The two reports offered more evidence that the recovery is strengthening. They also follow a government report Monday that said consumers stepped up their spending in March by the largest amount in five months. As evidence of that trend, MasterCard Inc. on Tuesday said its first-quarter profit jumped 24 percent as more shoppers are feeling comfortable enough about the economy and their jobs to reach for the plastic again.

But Wall Street appeared to be more focused on the growing debt crisis in Europe. Stocks dropped sharply around the world over concerns that European countries would fail to approve a $144 billion bailout package for Greece. By early afternoon the Dow Jones industrial average was down more than 230 points, erasing a 143-point gain on Monday.

At the moment, manufacturing is the leading star of the economic rebound and economists are predicting that will continue for the rest of the year, helping to offset weakness in other areas. Manufacturers are benefiting not only from the rebound in the United States but also rising demand for U.S. exports as the global economy recovers at a faster rate than had been expected.

Factory orders have jumped in 11 of the past 12 months, and economist anticipate more gains in the coming months.

"Businesses slammed on the brakes too hard in reducing inventories during the recession," said Tim Quinlan, an economist at Wells Fargo Securities. "Now that the recession is over, the shelves are bare and that means they have to ramp up their orders to restock. We are seeing pretty broadbased strength in a lot of industries."

But Quinlan said factory orders are only 44 percent of their pre-recession peak from July 2008. Even with manufacturers producing more, Quinlan expects high unemployment and low housing values to slow economic growth.

"We are not out of the woods yet in terms of the job market," he said. "The biggest ongoing burden for the economy is that about 10 percent of the workforce is out of a job and another 10 percent are not working as much as they would like to work. That will be a drag on growth."

For March, demand for durable goods, items expected to last at least three years, fell 0.6 percent, a better showing than a preliminary report on April 23 which had put the decline in durable goods at 1.3 percent.

The overall durable goods number was heavily influenced by a big swing in commercial aircraft, a volatile category, which plunged 66.9 percent in March after having posted huge gains in the two previous months.

Total transportation orders were down 12.3 percent. That was the biggest drop since June of last year as a 2.7 percent rise in demand for motor vehicles and parts only partially offset the plunge in aircraft.

But excluding transportation, factory orders posted a 3.1 percent rise, the best showing since a 3.6 percent increase in August 2005.

The strength in other industries was widespread, Orders for primary metals, including iron and steel, increased 4.7 percent while demand for machinery was up 8.6 percent, led by a 28.1 percent surge in construction machinery.

Orders for computers and other electronics products increased 22.7 percent.

The report showed that demand for nondurable goods, products such as oil and chemicals, rose 2.9 percent in March. The strength in nondurables included strong increases in demand for petroleum, chemicals and tobacco.

The Institute for Supply Management reported Monday that its closely watched gauge of manufacturing activity rose to 60.4 in April, up from 59.6 in March.

That was the strongest reading in nearly six years and represented the ninth straight month that the index has signaled growth in manufacturing. A reading above 50 indicates manufacturing is expanding while readings below 50 signal that the factory sector is contracting.

Home sales have received a boost from the federal government's tax credit of up to $8,000 for home buyers.

These incentives have stimulated the market, but the deadline to get a signed sales contract was April 30. Many analysts project sales will drop sharply in the second half of the year.

"Strength in the spring was all but certain," wrote Dan Greenhaus, chief economic strategist at Miller Tabak. "A slump following the credit's expiration is likely although the exact timing is difficult to predict."

Some analysts expect prices to slump as well, especially if mortgage rates rise and more foreclosed homes hit the market.

Nevertheless, economists and real estate agents alike hope the economy will be strong enough to bring down the unemployment rate from the current 9.7 percent. If that happens, it "could be enough to stabilize the housing market," wrote Jennifer Lee, an economist with BMO Capital Markets.

Source >>

Consumers step up spending, bolstering growth

Fri, 30 Apr 2010 10:21:00 GMT

(Reuters) - The U.S. economy expanded at a 3.2 percent annual rate in the first quarter as consumers stepped up spending, the strongest sign yet a sustainable recovery is taking hold.

While growth slowed from the fourth quarter's rapid 5.6 percent pace and was a touch weaker than economists expected, the details of the report from the Commerce Department on Friday were fairly upbeat.

Consumer spending, which normally accounts for about 70 percent of U.S. economic activity, added nearly 2.6 percentage points to U.S. gross domestic product last quarter, the biggest contribution since the fourth quarter of 2006.

"Once you take a quick look under the hood you see some very positive signs there," said Ward McCarthy, chief financial economist at Jefferies $ Co. in New York. "This is just the latest piece of evidence to suggest that the recovery is sustainable."

Still, markets showed some disappointment. U.S. stock markets were lower, while prices for U.S. government debt edged up. The dollar was little changed.

Analysts had expected GDP, which measures total goods and services output within U.S. borders, to grow at a 3.4 percent rate in the first three months of 2010.

The economy has now grown for three straight quarters, although it still has a lot of lost ground to make up after its deepest and longest recession since the 1930s.

The report showed consumer spending rose at a 3.6 percent rate in the January-March period, more than double the 1.6 percent pace in the fourth quarter and the biggest gain since the first quarter of 2007.

"Retail sales are up, people are spending money," said Michael Woolfolk, senior currency strategist at BNY Mellon in New York. "We're seeing the beginning of the process of a broad-based recovery."

The United States has emerged from recession more swiftly than Europe or Japan. Euro zone first-quarter GDP data is due in mid-May and is expected to show annualized growth of roughly 0.8 percent. Japan, which has been struggling with deflation, does not report its data until later in May.

Analysts said the welcome but moderate pace of U.S. growth meant the Federal Reserve could bide its time before raising benchmark interest rates from their current levels near zero, particularly with unemployment hovering near 10 percent.

The U.S. central bank on Wednesday noted activity had strengthened in recent weeks and that the labor market was starting to improve. Still, it said it expects a modest recovery and renewed its vow to keep rates low for an extended period.

BUSINESSES RESTOCK SHELVES

Business inventories increased $31.1 billion in the first quarter, adding 1.57 percentage points to GDP, as businesses restocked to meet firming demand. It was the first increase in inventories since the first quarter of 2008.

Businesses also continued to spend on software and equipment, though a bit less vigorously than in the prior quarter, boding well for the economic recovery.

"If they are spending on equipment already, it shows a lot of confidence for the future hiring which supports consumer spending. If we continue to have employment growth, we will have a good year," said Kurt Karl, head of economic research at Swiss Re in New York.

Last month the economy enjoyed the strongest jobs growth in three years as private employers stepped up hiring.

New home construction was a drag on growth in the first quarter after two quarters of gains. Residential investment contracted at a 10.9 percent rate.

Business spending on structures subtracted from GDP for a sixth straight quarter.

Export growth slowed sharply to a 5.8 percent pace in the first quarter from a 22.8 percent rate in the prior period, while imports rose at an 8.9 percent rate. That left a trade deficit that chipped off 0.61 percentage point from GDP.

A separate report from the U.S. Labor Department showed employment costs rose 0.6 percent in the first quarter as benefit costs posted their biggest gain since the second quarter of 2002. Wages advanced just 0.4 percent.

Other reports showed business activity in both New York city and Chicago grew in April, providing additional signs the economy's recovery was growing more durable.

The Thomson Reuters/University of Michigan's Surveys of Consumers showed sentiment falling in April from March as consumers saw the recovery as well under way, but slow. However, their view on how the economy will look 12 months from now improved from the prior month.

Source >>

NABE: Economists upbeat about economy

Mon, 26 Apr 2010 14:21:00 GMT

Economists are more upbeat about the economy as companies add jobs and increase profits, though a recovery will be slow, according to a national report released Monday.

Seventy percent of economists say the national gross domestic product will increase more than 2 percent this year, compared to only 61 percent in January. And 24 percent of economists say GDP will grow by more than 3 percent this year, compared to 14 percent of economists in January, according to the National Association of Business Economics in Washington, D.C.

“The U.S. recovery from the Great Recession continues, with business conditions improving,” said William Strauss of the Federal Reserve Bank of Chicago. “While input costs have been increasing, prices also have been moving higher, allowing profits to continue to rise. After more than two years of job losses, job creation increased in first quarter of 2010, suggesting a better outlook for hiring over the next six months.”

The closely watched report — with 68 national economists surveyed — found enough evidence that the economy is growing, albeit slowly. However, the economists look at the national outlook, not by region. Maryland is dealing with a $2 billion budget deficit and the state's unemployment rate sits at 7.7 percent. That rate, however, held steady at 7.7 percent in March after the state added nearly 36,000 jobs, the largest increase among all U.S. states.

Higher profit margins, increased demand and more hiring are positive signs for the recovery, according to the report.

Fifty-seven percent of companies detail increasing demand for products and services, the third-consecutive quarterly gain. Profit margins also climbed for the third-consecutive quarter, with 25 percent of respondents reported increased profitability.

Job growth improved for the first time in two years. Twenty-two percent of companies added jobs during the past quarter, compared to 13 percent in the January survey. Fewer companies are cutting jobs, only 13 percent in April, down from 28 percent in January. And almost two of every five economists expect their companies to add employees during the next three months, up from 29 percent in the previous survey.

But economists are concerned about a few major issues, including the credit crunch — a critical problem for growth — and increasing material prices.

Finally, economists say the federal economic stimulus — the $787 billion funding that ends Sept. 30 — has had little, if any effect on employment.

Source >>

U.S. Economy: Sales of New Homes Surge 27%, Goods Orders Climb

Fri, 23 Apr 2010 12:50:00 GMT

April 23 (Bloomberg) -- Sales of new homes surged 27 percent in March and orders for most durable goods climbed, indicating the U.S. economy sped up heading into the second quarter.

The gain in new-home sales was the biggest in 47 years as buyers rushed to qualify for a government tax credit and the weather improved, a Commerce Department report showed. Bookings for goods meant to last at least three years, excluding cars and aircraft, climbed 2.8 percent.

Treasuries slid and the dollar advanced against the yen as the reports pointed to pickups in housing, business investment and exports that may benefit companies from builders such as Pulte Group Inc. to makers of capital goods including Eaton Corp. The outlook for the rest of the year hinges on job gains that will spur consumer spending, which makes up 70 percent of the economy.

“The pieces are falling into place for a strong recovery,” said Gus Faucher, director of macroeconomics at Moody’s Economy.com in West Chester, Pennsylvania. “We’ve got strong business investment and we’re going to have some investment in residential” real estate.

The drop in Treasury securities brought the yield on the benchmark 10-year note up to 3.83 percent at 12:45 p.m. in New York from 3.77 percent late yesterday. The dollar increased 0.7 percent to 94.18 yen.

Exceeds Forecasts

Economists forecast purchases would rise to a 325,000 annual rate in March, according to the median estimate of 77 economists surveyed. Projections ranged from 300,000 to 362,000.

Demand may remain elevated through this month as Americans take advantage of a tax credit worth as much as $8,000 before it ends at the end of next week.

“We’ll probably see another jump in April and then we’ll get some payback in May and June,” said Jim O’Sullivan, global chief economist at MF Global Ltd. in New York. “Through the volatility, the trend in home sales is probably more up than down.”

Builder shares rallied, led by Pulte of Bloomfield Hills, Michigan, Miami-based Lennar Corp. and Standard Pacific Corp., which is based in Irvine, California.

Broad-based Gain

Sales increased in all four U.S. regions last month, led by a 44 percent jump in the South. The median price of a new home increased 4.3 percent in March from a year earlier to $214,000.

The Obama administration extended an incentive for first- time homebuyers in November and expanded it to include some current owners. The deadline for signing contracts is the end of this month, and the transactions must be completed by June 30.

Sales of previously owned homes, which account for about 90 percent of the housing market, are tabulated at contract closings, meaning demand may remain elevated through June. Purchases of new houses reflect contract signings, indicating the credit’s maximum influence on that market will be seen through April.

A report yesterday from the National Association of Realtors showed sales of existing homes jumped to a 5.35 million rate in March, the first increase in four months.

Durable Goods

The gain in orders for durable goods excluding transportation equipment last month was the biggest since the recession began in December 2007, another Commerce Department today showed.

Total orders unexpectedly dropped 1.3 percent, depressed by a 67 percent plunge in demand for commercial aircraft.

Eaton, the Cleveland-based maker of engine valves and transmissions, is among companies profiting from growth in demand for car and truck parts. This week it posted first- quarter profit that exceeded analysts’ estimates and raised its 2010 earnings forecast.

“The expanding world economy drove growth in most of our markets,” Chief Executive Officer Sandy Cutler said in a statement. “In general we are seeing the strongest growth in Asia and Brazil, while many U.S. markets are starting to accelerate and Europe is recovering more modestly.”

Business investment in equipment and software climbed at a 19 percent annual rate in the fourth quarter, the biggest gain in 11 years.

Global Recovery

Factories are ramping up output as improving economies from Brazil to China and India boost overseas sales and rising U.S. demand prompts companies to update equipment and replenish stockpiles after last year’s record drawdown.

Bookings for non-defense capital goods excluding aircraft, a proxy for future business investment, increased 4 percent. Shipments of those items, used in calculating gross domestic product, increased 2.2 percent.

Economists at Morgan Stanley in New York raised their forecast for economic growth in the first three months of the year to a 3.4 percent annual pace after the reports on goods orders from a prior estimate of three percent.

The U.S. economy, the world’s largest, expanded at a 5.6 percent pace in last three months of the year as companies stepped up efforts to stabilize inventories. It was the strongest rate of growth in six years.

Source >>

Home remodeling grows for first time in 4 years

Fri, 23 Apr 2010 11:30:00 GMT

TAMPA - Jeanine Frederick has been waiting for nearly two years on her dream kitchen. Her home recently sold and now the family is building a new one.

"I'm picking out kitchen cabinets, making selections on door styles and finishes," she said during a recent afternoon shopping trip to Home Depot. "It's refreshing."

Frederick isn't the only one pumping money into the building and remodeling industry. Homeowners who held back on projects because of the sluggish economy are moving forward now.

Some are going big, like Frederick, and tackling large projects such as kitchens, bathrooms and room additions. Others are opting for smaller projects that spruce up their homes without having to fork over a lot of cash. They're going for new faucets, light fixtures, ceiling fans or just a new paint color.

This year is expected to be the first annual spending increase for the remodeling industry since 2006, according to the first quarterly report by the Joint Center for Housing Studies of Harvard University.

To Florida's construction industry, which has lost the most jobs during the recession, such projections are welcome news. While remodeling won't bring jobs back in full, it's a start.

The Harvard report looks only at projects on primary homes. School researchers predict consumer spending on remodeling projects to reach $121.5 billion in 2010, compared to $115.8 billion in 2009. At the industry's peak in 2006 remodeling spending hit $144.0 billion.

"People cut back on spending over the past couple of years and cut out discretionary projects," said Abbe Will, a research assistant who worked on the Harvard report. "Now that the housing market is improving, consumer confidence is improving."

During the boom years, homeowners cashed in on their equity, borrowing against their homes and using the money for renovations. Those days are gone as home values plummeted, and most homeowners no longer have equity to tap.

Remodeling dropped off in late 2007 and has been falling since. During the economic downturn, many couldn't afford to improve their homes. Home sales dropped and foreclosures skyrocketed.

Homeowners who owe more than properties are worth are increasingly accepting reality and deciding to remodel instead of buying a new home, Will said.

Many that are buying homes are using federal tax credits of up to $8,000 to spruce up their homes. They're adding screened rooms, fences and replacing carpet.

Companies from Home Depot and Lowe's to local remodeling companies say business has dramatically picked up over the past couple of months.

Both home improvement super giants said they've noticed a recent increase in homeowners hiring them to do their projects. But they've also noticed more people tying get the most bang for their buck.

"They're doing things they can do themselves," said Craig Fishel, a spokesman for Home Depot. "They're tiling kitchen and bathroom floors and adding tile backsplashes."

Max Maraj, of Alexander Inc. of Tampa Bay, said he's noticed a big change in the past 30 days.

"People can't sell for what they need to sell for, so they want to make their homes better," he said. "Last year, we had a lot of lookers, people kicking the tires. Now, people are ready to do it."

One client, for example, has a 1,500 square-foot home in south Tampa. With a baby on the way, they want a larger home. In a better housing market, they might sell and buy a new house, but they've decided instead to add onto the house.

Maraj thinks more people would opt for big projects if they could get financing. He advises those seeking dramatic changes to add square footage to the home. Adding square footage, he said, adds value to the home. Lenders, he said, are more likely to grant a loan if the improvement will build equity.

"It's better for your value to add a master bedroom then a new kitchen," he said. "The kitchen will improve the sellability of the house, but not the value."

Jack Paulo, of Apollo Aluminum, said his clients say they're tired of looking at unsightly back yards. If they have to stay put in their homes, he said, they want to enjoy them more.

"You have to look at that yard everyday," he said.

Chris Ares, operations manager for American Countertop, said first quarter sales were up 40 percent, compared to the first quarter last year.

"We've been thinking the tax credit would be a major factor," Ares said. "People don't say how they're paying for their countertops, but more people are coming through our doors."

Source >>

ELFA says capex lending data shows "upswing"

Wed, 21 Apr 2010 13:58:00 GMT

(Reuters) - An important measure of U.S. business borrowing showed encouraging signs of health in March, according to a trade group for the lenders that finance half the capital equipment investment in the United States.

The Equipment Leasing and Finance Association said that a total of $4.3 billion in loans, leases and credit lines were originated in March to finance business investment. While that was down 8.5 percent from the same time last year, it represented the largest volume of financings so far this year.

Other measures of credit activity tracked by ELFA also indicated businesses were finding it a little easier to remain current on their existing loans.

ELFA said the percentage of borrowers delinquent 30 days or more on their loans, leases or lines of credit fell to just 4.2 percent of receivables in March from 5.7 percent in February and 4.9 percent a year before.

Charge-offs also declined. ELFA said lenders considered only 1.5 percent of their receivables as losses unlikely to ever be recovered, down from 1.9 percent in February and 2.2 percent a year earlier.

"Demand for equipment leasing appears to be on the upswing," said David Schaefer, the president of Orion First Financial in Gig Harbor, Washington. Orion First Financial is a member of ELFA and lends money to companies making capital equipment purchases.

"We are seeing delinquencies begin to stabilize and losses have been improving over the past six months. While the economy and leasing industry are both a long ways away from getting back to where they once were, it appears that business and consumer confidence is building," Schaefer said.

ELFA's report, provided to Reuters a day ahead of its official release, was consistent with recent encouraging earnings reports from a number of top U.S. makers of capital equipment, including Eaton Corp (ETN.N) and Paccar Inc (PCAR.O).

It was released on the same day that a number of U.S. banks, including Wells Fargo & Co (WFC.N), reported results that suggested the consumer loan losses that have plagued the financial sector are easing.

ELFA's members include Bank of America Corp (BAC.N), Canon Inc (7751.T) affiliate Canon Financial Services, Caterpillar Inc's (CAT.N) Caterpillar Financial Services Corp, CIT Group Inc (CIT.N), Dell Inc's (DELL.O) Dell Financial Services, Deere & Co's (DE.N) John Deere Credit Corp, Siemens AG's (SIEGn.DE) Siemens Financial Services and Verizon Communications Inc's (VZ.N) Verizon Capital Corp affiliate.

More than half the money invested in plants, equipment and software in the United States in any given year is financed with loans, leases and lines of credit.

Source >>

Report: Stimulus created 49K 1Q jobs in Maryland

Mon, 19 Apr 2010 13:18:00 GMT

The American Recovery and Reinvestment Act was responsible for creating or saving 49,000 Maryland jobs in the first quarter of 2010, a recent report released by the White House claims.

The Council of Economic Advisors conducted the analysis. It follows a report that said the economic stimulus initiative created about 2.5 million jobs nationwide in the same period.

The stimulus could have helped fuel 36,000 new jobs in the state during March, the U.S. Bureau of Labor reported Friday. Overall, Maryland's unemployment rate held steady last month at 7.7 percent.

President Barack Obama signed the $787 billion Stimulus Bill into law in February 2009.

“From tax cuts to construction projects, the Recovery Act is now firing on all cylinders when it comes to creating jobs and putting Americans back to work,” said Vice President Joe Biden in a press release. “We’re not only providing needed relief and spurring job creation now, but laying a new foundation for economic growth that will create jobs for a long time to come.”

Source >>

Leading economic index at record high in March

Mon, 19 Apr 2010 10:35:00 GMT

(Reuters) - A gauge of the U.S. economy's prospects rose more strongly than expected to a record high in March, pointing to a steady economic recovery, a private research group said on Monday.

The Conference Board said its index of leading economic indicators increased 1.4 percent, rising for the 12th straight month, after an upwardly revised 0.4 percent gain in February.

Analysts polled by Reuters had expected a 1.0 percent rise in March from a previously reported 0.1 percent gain.

U.S. stocks held slim gains after the report, while Treasury debt prices and the U.S. dollar were little changed.

"The indicators point to a slow recovery that should continue over the next few months. The leading, coincident and lagging series are rising. Strength in demand remains the big question going forward," said Ken Goldstein, an economist at the Conference Board.

Seven of the 10 indicators that make up the leading index rose last month, with the interest rate spread, average weekly manufacturing hours and stock market prices making the largest contributions.

The drag on the index came from the real money supply, manufacturers' new orders for nondefense capital goods and consumer expectations.

The coincident index, which measures current economic conditions, edged up 0.1 percent in March after a 0.1 percent gain the prior month. The lagging index rose 0.2 percent after a 0.1 percent increase in February.

Source >>

We're overlooking all the good news about the economy

Thu, 15 Apr 2010 11:24:00 GMT

By Paul Samuelson

WASHINGTON — When things were going well, it was said that the United States enjoyed a Goldilocks Economy. Growth was fast enough to produce jobs and higher incomes but not so fast as to generate inflation. In the same vein, it might be said that today we have an Oscar-the-Grouch Economy. Good news is discounted. Pessimism is trendy. Growth is considered too feeble to help real people. But there is some genuine good news — and it deserves attention.

It's most obvious in the labor market. The increase of 162,000 payroll jobs in March was the largest in three years. Layoffs have subsided to pre-recession levels. Job openings have ended their precipitous decline.

Surveys suggest more gains. A poll of the corporate chief executive officers in the Business Roundtable found that 29 percent expect to increase jobs over the next six months and only 21 percent expect to cut; not since the fall of 2008 have more CEOs expected to hire than fire. In March, the National Federation of Independent Business, a trade group for small firms, found no net job cuts — the first time since April 2008.

What's also encouraging is that the recession's severity has left much pent-up demand. Mark Zandi of Moody's Economy.com reckons that the underlying need for housing totals about 1.85 million units a year. Meanwhile, home and apartment construction is running at 600,000 a year. "We're working down a high inventory of unsold homes," says Zandi, "but housing will come back."

The same logic applies to cars and trucks: Sales collapsed from 16.2 million in 2007 to 10.4 million in 2009. They're bound to rise.

A final favorable omen is Corporate America's strong cash position, reflecting deep cuts in jobs and capital spending, says economist Nariman Behravesh of IHS Global Insight, a forecasting firm. In 2009, business cash flow equaled 11 percent of gross domestic product, the highest in at least half a century. As companies gain confidence that the worst is past, they have the cash "to make a bet on recovery" by restarting canceled investment projects, says Behravesh. IHS Global Insight expects business spending on machinery, computers and software to increase 9.6 percent in 2010.

One cause of pessimism is that the U.S. economy is undergoing a fundamental change — and it's unclear how successful the transition will be. Beginning in the 1980s, American prosperity depended increasingly on a debt-financed expansion of consumer spending and housing, as Greg Ip of The Economist notes in a recent survey of the economy. In 1991, consumer spending and housing accounted for 70 percent of GDP; by 2005, their share was 76 percent. That boost has now ended, because many families overborrowed, overspent and undersaved.

As Americans repay debt and shore up savings, consumer spending and housing weaken. In 2009, their share of GDP had already dropped to 73 percent. So the U.S. economy needs another growth engine. Exports and related investment are obvious candidates. This includes both expensive equipment and sophisticated services. But no one knows how well exports will do.

The deeper source of pessimism is the trauma inflicted by the economic slump. Unlike other post-World War II recessions, upper-income families shared the fear, as their stocks and housing wealth collapsed and their jobs vanished or seemed threatened. Overall payroll job losses of 8.4 million have been devastating in magnitude and duration. Among the unemployed, 44 percent have been without work half a year or more.

Life plans have unraveled. Public psychology has darkened, because most upsets were unanticipated. People and companies have become more cautious, hedging against what they don't know. If the unexpected happened once, it could happen again.

The concerns aren't unrealistic, especially considering America's long-term problems. Still, the glumness may be overdone, just as the optimism of the Goldilocks Economy was overdone. Public mood swings move the economy.

The irony of today's pervasive pessimism is that, as people's worst fears are not realized, it could begin to lift and give the economy a surprising forward shove.

Source >>

Ken Fisher says signs abound of economic recovery

Wed, 14 Apr 2010 16:28:00 GMT

(Reuters) - Skepticism about recovery obscures a number of signs that prove otherwise, especially the driving force that emerging markets now command in the global economy, billionaire investor Ken Fisher said on Wednesday.

Fisher, the Forbes columnist who has been tagged a perma bull by critics, said markets have failed to take into account the big spread between short- and long-term interest rates, a classic indicator of an economy on the verge of recovery.

Skeptics also ignore the amount of junk bonds sold in the first quarter, Fisher said in an interview. Sales of U.S. junk bonds surged to $61 billion from $11 billion a year earlier, according to Thomson Reuters data.

"People are snarky. The nature of a bear market is that it creates skepticism," said Fisher, who oversees $40 billion as founder and chief investment officer of Fisher Investments.

Investors and the broad public do not view optimists as heroes and are fixated on the downside, failing to see all the signs that the global economy is doing very well, he said. Who was right calling the bear market garners more attention than who was right calling its end.

"People are still in the mode of focusing on who was right from mid-2007 to March of 2009, they're not today focused on who's been right for the last 15 months," Fisher said.

Data shows that since the late 19th century the total return of stocks, which includes dividends, has always gained in the second 12 months after a bear market has bottomed, he said.

On a price-only basis, stocks failed to gain in the second 12 months after the trough only once, in 1932, he said.

Wall Street rallied on Wednesday, with the broad S&P 500 charging past the key psychological barrier of 1,200, as U.S. stocks advanced for a fifth straight session on better-than-expected earnings at Intel Corp (INTC.O) and JPMorgan Chase & Co (JPM.N).

The latest economic data continued to surprise on the upside, too. U.S. retail sales rose 1.6 percent in March. And China's economy grew a faster-than-expected 11.9 percent in the first quarter from a year earlier, the fastest annual pace in nearly three years, two market sources said, a day before China is scheduled to publish its first-quarter GDP growth rate.

The world is being led by growth in emerging markets, which now account for about one-quarter of global gross domestic product as a growing middle class consumes, Fisher said, noting that the U.S. economy makes up only 23 percent of world GDP.

While emerging markets outperformed over much of the past decade, Fisher sees that cycle near an end, saying the signal will be when everyone is talking emerging markets.

He blew off fears that Greece's debt woes could spread across southern Europe, scoffing: "And then after that the aliens come?"

Greece has been unwilling to pay up to meet the demands of investors who should see the country the same as lower-quality corporate debt, he said, adding, "Greece is trivial."

Record inflows into bond funds are a sign of the pessimism and disbelief of economic recovery that has taken hold of many people, who mistakenly seek "clarity" to make their move.

"Clarity is one of the most expensive things in the world to wait for. People have a perverse desire to buy high, sell low," Fisher said.

"The world is doing really nicely. Good things are popping up everywhere," he said.

Industrials, materials and technology have led the rally. Rotation of the market's leadership will signal a new phase, Fisher said, while industrials, health care -- with its inelastic demand -- and consumer discretionary stocks will lead in the future.

Fisher Investments' global total return strategy net of fees for private clients has gained 56.9 percent over the previous 12 months ended March 31, compared to 52.4 percent for MSCI's World Index and 49.8 percent for the S&P 500.

The composite performance of the strategy, which accounts for about 80 percent of Fisher's high net worth accounts, also outperformed the two benchmarks over the prior three- and five-year periods.

Source >>

Legg Mason reports managed assets up 8%

Tue, 13 Apr 2010 10:28:00 GMT

Legg Mason Inc., the Baltimore-based money manager, said that its assets under management were 8 percent higher in March than they were in March 2009.

Legg Mason (NYSE: LM) had a total of $684.5 billion in assets under management as of March 31, compared with $632.4 billion a year ago, according to a preliminary tally the company released Tuesday.

Fixed income assets under management, including bonds, rose to $364.3 billion, up from $357.6 billion in March 2009. Equity assets under management, including stock, increased to $173.8 billion, compared with $126.9 billion a year ago. Liquidity assets under management declined to $146.4 billion, down from $147.9 billion.

In Legg Mason’s most recent quarterly earnings report, covering the three months ended Dec. 31, the company posted a profit of $44.9 million, or 28 cents a share. That was an improvement from the almost $1.5 billion, or $10.59 a share, the company lost in the October-to-December period in 2008.

Source >>

Consumer confidence up in April from year-low

Tue, 13 Apr 2010 10:15:00 GMT

NEW YORK (Reuters) – U.S. consumer confidence rebounded in April after hitting in March its lowest level in a year, boosted by stock market gains and modest job market improvement, a research group said on Tuesday.

Investor's Business Daily and TechnoMetrica Market Intelligence said their IBD/TIPP Economic Optimism Index rose to 48.4 in April from March's reading of 45.4.

Readings above 50 indicate optimism, while those below 50 point to pessimism.

Last month marked the gauge's lowest level since March 2009. It now stands exactly at its 12-month average and 4 points higher than the 44.4 level IBD reported in December 2007 when the recession began.

"Reports of a 162,000 jump in jobs for March certainly aided consumers' perception of a modest improvement in the economy," said Terry Jones, associate editor of Investor's Business Daily.

"No doubt, the Dow Jones industrial average's flirtation with the 11,000 level for the first time since late 2008 also gave the economy a shot in the arm," Jones said.

The IBD/TIPP surveys more than 900 adults generally in the first week of the month. The survey has a margin of error of plus or minus 3.3 percentage points.

Source >>

Forecaster raises 2010 ad spending forecast

Thu, 08 Apr 2010 16:45:00 GMT

A leading advertising forecaster is raising its 2010 outlook on global ad spending — the most bullish reading it has had in more than a year — saying companies are gaining more confidence that the economic recovery will stick.

ZenithOptimedia expects combined ad spending in various media — including newspapers, television and billboards — to grow by 2.2 percent this year to $456 billion. That's up from its previous forecast of slightly less than 1 percent, made in December.

It's the second time the forecaster has upgraded its 2010 outlook. The upgrades followed 18 months of consecutive downgrades.

ZenithOptimedia said Wednesday that ad spending is stabilizing among developed nations in North America, Western Europe and Japan while developing economies are expected to resume their rapid growth.

Ad spending is still expected to fall in the U.S., by 2 percent. North America, which covers the U.S. and Canada, is the only region expected to see a decline, by 1.5 percent, because it led the ad downturn and will be the last one to recover.

Worldwide, online ad spending is expected to increase by nearly 13 percent this year to $62.6 billion. Internet ads, which overtook magazines last year with a 12.6 percent share of the total ad market, should take a 17 percent market share in 2012. It would be the third-largest recipient of ad spending, after TV and newspapers.

But newspapers, magazines and radio are expected to continue struggling around the world. Newspapers should see a 3.8 percent decline in ad spending to $97.7 billion while magazines should see a bigger slump of 4.4 percent to $43.3 billion. Ad spending on radio should dip less than 1 percent to $33.5 billion.

Worldwide ad spending on television, however, is expected to increase by 4.4 percent to $181 billion, as people continue to embrace entertainment during the downturn. TV also is seen as a key medium for companies to build brands.

Outdoor ad spending should increase as well, by 1.7 percent to $29 billion.

ZenithOptimedia also raised its 2011 global ad spending forecast, to 4.1 percent from 3.9 percent, and for 2012, to 5.3 percent from 4.8 percent.

Source >>

Some U.S. CEOs ready to resume hiring: Roundtable

Wed, 07 Apr 2010 12:16:00 GMT

(Reuters) - U.S. chief executive officers are feeling more confident about the economy, with more of them planning to add rather than cut jobs over the next six months, a Business Roundtable survey released on Wednesday found.

The change in mood -- CEOs had been inclined toward cutting jobs for about two years -- marked an important shift for an economy struggling to regain its footing after its worst downturn since the Great Depression of the 1930s.

The retail sector is leading the charge toward hiring as consumer spending begins to pick up, said Verizon Communications Inc (VZ.N) CEO Ivan Seidenberg, chairman of the Business Roundtable, which conducts the quarterly survey.

Twenty-nine percent of U.S. CEOs told the Roundtable they plan to add jobs in the United States over the next six months, more than the 21 percent who planned to cut. That marked the first time since the first quarter of 2008 that more planned to add jobs than cut them.

"The improved employment outlook is a result of increased demand," Seidenberg said on a conference call with reporters. "We have seen some signals from the retail segment of our CEOs that they are looking at some hiring going on, because they see some demand picking up."

The retail sector is a key indicator of consumer spending, which accounts for about two-thirds of U.S. economic activity.

"This gives us confidence that the two pillars that could sustain this recovery are maybe starting to get set in place," said Boston College economics professor Bob Murphy. "The recovery ultimately will depend on whether consumption picks up."

The finding follows a Friday government report showing that U.S. employers added jobs at the fastest rate seen in three years last month. Major U.S. retailers from Target Corp (TGT.N) to Saks Inc (SKS.N) are expected to show strong March sales growth when they release monthly results on Thursday.

SALES, CAPEX ALSO TRENDING UP

Seventy-three percent of CEOs expect their companies' sales to rise over the next six months, while 47 percent plan to boost U.S. capital spending over that time.

Seidenberg noted that sales growth and capital spending, both of which improved in the first quarter, tend to rise before hiring resumes.

CEOs look for a 2.3 percent rise in real U.S. GDP in 2010, the survey found.

The overall U.S. CEO Economic Outlook Index stood at 88.9, up from 71.5 at the end of 2009 and the highest since the second quarter of 2006. The outlook index is a diffusion index, which can range from negative 50 to positive 150. A reading above 50 indicates growth; below 50 signals contraction.

Some companies continue to cut back -- business software maker CA Inc (CA.O), for instance, on Tuesday said it would cut 1,000 jobs as it copes with weak profits.

Investors will get a deeper look into how corporate America is doing next week, as big U.S. companies including Alcoa Inc (AA.N), JPMorgan Chase & Co (JPM.N), Google Inc (GOOG.O) and General Electric Co (GE.N) report their first-quarter results.

Business Roundtable member companies, 105 of which answered the survey between March 15 and 30, generate nearly $6 trillion in collective revenue and employ more than 12 million people.

Source >>

Baltimore, national retailers begin to see gain

Thu, 01 Apr 2010 14:37:00 GMT

Baltimore’s retail is beginning to bounce back, as the nation’s shopping centers are also seeing the first sales improvement in more than two years.

U.S. shopping centers saw some sales gains in March for the first time in 32 months, according to a new report by the International Council of Shopping Centers.

The International Council of Shopping Centers posted a 4.5 percent business increase nationwide last month, bringing its business barometer, a key metric for the retail industry, to 52.6 percent. This is the first time since July 2007 the barometer has crossed 50 percent.

Baltimore’s retail has been seeing small increases in growth since November, said Tom Saquella, president of the Maryland Retailers Association. Saquella said electronics, apparel and jewelry have noticeably rebounded, while furniture is still lagging.

“We think the bleeding’s done, but there’s still a way to go until we’re where we want to be,” he said.

Arundel Mills, which doesn’t have its March numbers available yet, has seen a flurry of activity in the past month, said spokeswoman Wendy Ellis. February had been a tough month for retailers in the Baltimore area because of the back-to-back snowstorms, but overall 2010 is expected to be a good year for the area’s retail industry, Ellis said.

Arundel Mills in particular has stayed afloat because it has outlets, attracting the recession-savvy shoppers who are looking for deals, she said.

If the ICSC’s barometer reaches 50 percent, it means industry conditions are unchanged; below 50 percent means deterioration and above 50 percent marks improvement.

The barometer consists of two indexes that measure year-over-year sales growth, customer traffic, changes in occupancy rates and changes in rent and capitalization rates.

Its lowest point was in the first quarter of 2009, when business dropped to below 30 percent, according to the International Council of Shopping Centers.

Source >>

O'Malley signs jobs bill, unemployment relief

Thu, 25 Mar 2010 02:50:00 GMT

Businesses can now apply for a $5,000 tax credit for hiring an unemployed person under a law Gov. Martin O’Malley signed Thursday.

The state also qualified for $127 million in federal stimulus money to pay unemployment benefits to the jobless under another new law. The emergency legislation goes into effect immediately.

Unemployment insurance reform and the jobs tax credit had been key pieces of O’Malley’s legislative agenda to help the state’s businesses recover from the recession, and to help the jobless get back to work.

“There is no government program that is as important or as empowering as a job,” O’Malley said in a statement. “Progress requires that we focus the energies of this legislative session on creating jobs, saving jobs, and protecting jobs.”

The measures moved relatively swiftly through the General Assembly after some political wrangling. Businesses opposed O’Malley’s original proposal to lower their unemployment insurance taxes and after weeks of negotiations, it was removed from the bill.

The final legislation allows more people to qualify for unemployment insurance, something President Barack Obama’s administration encouraged by offering the stimulus money. It also lets businesses spread hefty unemployment insurance tax bills over the year and cuts the interest rate on late payments from 1.5 percent to 0.5 percent.

Businesses’ unemployment insurance tax rates at least tripled this year, going from $53 per employee to $187 employee for most companies. And the continuing high unemployment rate in the state — 7.5 percent in January — has drained the fund that pays out unemployment benefits to near bankruptcy.

The jobs tax credit received some criticism for not being enough of an incentive for companies, but O’Malley said he hoped it would encourage those that were on the fence about potential new hires. He had proposed giving out $3,000 per employee but the General Assembly raised that to $5,000.

Another bill signed into law repeals an existing provision that prohibits carmakers from paying bonuses directly to dealership employees.

Source >>

Job outlook for youth no worse this summer

Wed, 24 Mar 2010 16:49:00 GMT

NEW YORK (Reuters) - Summer jobs will be roughly as plentiful for teens and college students this year as they were in 2009, according to research released on Wednesday by a popular hourly job online site.

Twenty-nine percent of hiring managers said they planned to add the same number of students this summer, compared with 25 percent who said the same last year, the survey commissioned by SnagAJob.com showed.

Some 18 percent expect to hire fewer such workers, down from 23 percent in 2009, while six percent said they planned to increase their summer hiring, equal to last year's number, the poll said.

Nearly half, or 47 percent, do not expect to make seasonal hires, compared with 46 percent last year.

"Given the year that we've had, 'unchanged' on the summer job front is pretty good news," said Shawn Boyer, chief executive of SnagAJob.com in Richmond, Virginia. "It's a relief that we're not again seeing the kind of negative trends that we saw when comparing expectations for last summer with '08.

"Competition will still be fierce, especially because unemployment remains high," he added. The U.S. unemployment rate has been hovering at about 10 percent.

Those who end up getting a summer job can expect an average wage of $10.20 an hour, according to the survey.

In an open-ended question, hiring managers also were asked to give advice to teen job seekers, SnagAJob.com said.

"Don't make all questions about money and time off," a hiring manager said.

"Take the ring out of your ear, and cover up the tattoos," said another.

The third annual online survey was conducted by IPSOS Public Affairs, a research firm, between February 24 and March 1 and surveyed 1,033 managers with responsibility for hiring summer, seasonal and hourly employees.

The overall margin of error for the poll was 3.05 percentage points.

Source >>