US Retail Sales Slide but Upturn in Jobs Forecast

07 September 2004

The answer to the vexed question of whether the US's economy is recovering is yes – or no – depending on who you ask.

According to latest figures issued by the country's Labor Department, businesses took on 144,000 workers in August, a rise of 32,000 on the previous month. The headline unemployment rate was 5.4 percent, its lowest level since 2001.

So, cause for optimism says George W Bush, on the presidential campaign trail in Pennsylvania: "Our growing economy is spreading prosperity and opportunity, and nothing will hold us back. Overall we've added about 1.7 million jobs since August 2003."

However, Gary Thayer, economist at AG Edwards & Sons, while broadly welcoming the fall in unemployment, says employers are still hesitant over job creation, which needs to be running at 150,000 a month just to keep up with population growth and at 200,000 monthly to be a sign of economic boom.

Meanwhile, Democratic presidential hopeful John Kerry has chosen to focus on the 2.7 million jobs lost since 2001/2002.

He says Mr Bush "is now certain to be the first president since the Great Depression to face re-election without creating a single job".

And if lower than hoped-for job creation is causing concern about economic recovery, then the latest retail sales figures can only induce further nervous flutters.

Retail sales among the US 72 major chains rose by just 1.1 percent, according to the International Council of Shopping Centers, below the 3.1 per cent gain in July and the smallest since March last year.

Data sourced from: BBC Online Business News (UK) and The Wall Street Journal Online; additional content by WARC staff