Positive Economic Indicators Pointing to Better Job Market Into 2012

It isn’t exactly time to sing “Happy Days Are Here Again” but a number of economic indicators point to an improving U.S. job market during the next few months.

The week ending 12 Nov. 2011, fewer Americans than forecast filed first-time claims for unemployment insurance. Applications for unemployment benefits declined 5,000 in the week ended 12 Nov. 2011 to 388,000, the lowest level since April, according to Labor Department figures.

The number of people collecting unemployment benefits dropped to a three-year low.

Retail sales gained more than projected in October as shoppers spent more. The 0.5% gain, helped by the largest increase in electronics purchases in two years, follows a 1.1% jump for September, Commerce Department figures shows.

At the same time, producer prices fell for the first time in four months. Lower producer prices may make it easier for retailers to use discounts and maintain sales momentum through the holiday shopping season, another reported.

Gains in consumer spending, which accounts for about 70% of the economy, and are key economic recovery

at a time when Europe is having its debt crisis that threatening consumer sales overseas.

The index of U.S. leading indicators increased more than forecast in October, another sign the nation’s economy will grow in early 2012. The Conference Board’s outlook for the next three to six months rose 0.9%, the largest gain since February, after a weak 0.1% September increase, the New York- based research group said.

Nine of the 10 components of the leading index contributed to the increase in October, led an increase building permits, improved spread between short- and long-term interest rates, a longer factory workweek, and fewer claims for unemployment benefits.

The index “is pointing to continued growth this winter, possibly even gaining a little momentum by spring,” Kenneth Goldstein, a Conference Board economist , said in a statement. “The lack of confidence has been the biggest obstacle in generating forward momentum.”

Despite these positive signs, job growth remain slow and recovery unsteady.
Lack of confidence is exactly what the Federal Reserve Board says it has in the economy.