• Private Payrolls Climb, Jobless Claims Decline, US Trade Deficit Drops

    Payroll Employment Climbs

    Private-sector employment rose by 235,000 jobs from the prior month in December as annual pay climbed on average by 7.3% from year-earlier levels, according to the latest monthly tracking by payroll services provider ADP and Stanford University’s Digital Economy Lab.

    “The labor market is strong but fragmented, with hiring varying sharply by industry and establishment size,” ADP Chief Economist Nela Richardson said in a statement Thursday. “Business segments that hired aggressively in the first half of 2022 have slowed hiring and in some cases cut jobs in the last month of the year.”

    The numbers echo other recent government and analyst reports showing strong employment conditions despite numerous predictions of a pending recession. Layoffs remain limited outside industries such as technology, which has seen a wave of job cuts and space reductions by companies including Amazon, Salesforce and Facebook parent Meta.

    Outplacement firm Challenger, Gray & Christmas reported Thursday that announced job cuts rose 13% over the prior year in 2022. December’s 43,651 cuts were up 129% from year-earlier levels, with the bulk taking place in the technology sector at 16,193.

    “The overall economy is still creating jobs, though employers appear to be actively planning for a downturn,” Senior Vice President Andrew Challenger said in a statement. “Hiring has slowed as companies take a cautious approach entering 2023.”

    According to ADP and Stanford, December’s job gains were led by industries including leisure and hospitality at 123,000, education and health services at 42,000 and construction at 41,000.

    Jobless Claims Decline

    Initial claims for unemployment insurance declined 19,000 from the prior week to 204,000 in the week ended Dec. 31, another trend underscoring resilience in the U.S. job market.

    The Labor Department reported Thursday that the four-week moving average for claims declined 6,750 from the prior week to 213,750.

    Continued claims in all programs, tracked on a more delayed basis, totaled approximately 1.6 million for the week ended Dec. 17, down 18,444 from the prior week and well down from 1.9 million in the comparable week of 2021.

    Unemployment remained near 50-year lows in October and November at 3.7%, with the government expected to announce the December figure within the next few days.

    US Trade Deficit Drops

    The nation’s international trade deficit declined 21% from the prior month to $61.5 billion in November, aided largely by better sales growth of exports relative to imports amid slowing overall global demand, the Commerce Department reported Thursday.

    November goods exports declined $5.3 billion from the prior month to $170.8 billion, with goods imports falling $20.7 billion to $254.9 billion. For the first 11 months of 2022, U.S. exports increased nearly 19% from the year-earlier period while imports rose 18%.

    Analysts have noted that export and import trends have implications for industrial real estate demand. Rising exports can signal the need for more manufacturing facilities to meet overseas demand for U.S.-made goods.

    Also, the U.S. is seeing rising development of domestic manufacturing and distribution facilities as companies look to head off pandemic supply disruptions that originated overseas, especially for crucial tech components including computer chips. That trend could eventually reduce imports or slow import growth.

    Source: www.CoStar.com