Stronger Recovery Will Reduce Jobless
AS the United States heads into winter, the job outlook is suddenly starting to take a turn for the better.
More companies are hiring after several years of corporate downsizing that reduced many payrolls to unworkably low levels. Research by the National Federation of Independent Business shows a small net increase in hiring during the second and third quarters, the first such gain for its members since 1990. Moreover, a relatively mild winter in many parts of North America - which is now the consensus of a number of meteorologists - should help labor-intensive industries such as construction.
``We are expecting the new unemployment figures that come out this week [Friday] to show a slight downturn,'' says Cynthia Latta, an economist with DRI/McGraw-Hill, an economic consulting firm in Lexington, Mass. Even if that is not true this month, she sees a falling unemployment rate for the longer term.
That is good news for millions of Americans either seeking work or worried about the stability of their own jobs. The US unemployment rate has been dropping steadily during the past year, from 7.5 percent in September of 1992 to 6.8 percent in October of 1993.
DRI/McGraw-Hill expects the rate to drop to 6.6 percent by the end of 1993. ``Consumer spending is proving to be much stronger than many people had thought,'' Ms. Latta says. ``Business inventories are also low. With consumer confidence now rising, we expect some rebuilding of inventories.''
US economic growth should be strong in the fourth quarter of 1993, at around 4 percent; then it should drop slightly to around 3 percent in the first quarter of 1994. But both quarters will help produce jobs while holding down unemployment, she says.