Economy Muddles Along

greenvilleonline reports trade group Institute for Supply Management (ISM) says its manufacturing index edged up from June over July 49.7 to 49.8, but still shy of 50, which indicates the economy is contracting. Any reading below 43 would indicate recession. The report notes job growth has stalled and manufacturing activity has weakened amid reports of economic woes in Europe, and lessened demand for U.S. goods in China, India and Brazil because of slower growth in those economies. The government reports construction spending rose for the third straight month, attributable to a rise in homebuilding, suggesting the housing industry may be turning around. Meanwhile, payroll services provider ADP says businesses added 163,000 jobs in July, but economists expect the government report out Fri., Aug. 3 will show only about 100,000 jobs were added, leaving the unemployment rate at 8.2 percent. MHProNews has learned manufacturers added only an average of 10,000 jobs a month in Q2 2012, well below the monthly 41,000 average in the first quarter of this year. Weak consumer spending, which fuels economic growth, fell to 1.5% in the second quarter from two percent in Q1.

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