By Isaac Cohen*
Several indicators are pointing to a slowdown in the US economy. The jobs report for November, issued last week by the Labor Department, confirms this perception. The creation of 155,000 new non agricultural jobs in November is less than 237,000 created in October. Even so, unemployment remained at 3.7 percent, the lowest in almost fifty years. Meanwhile wages increased 3.1 percent from a year earlier, the same as in October, the second consecutive month of wage growth not seen since 2008.
Employment growth was uneven by sectors. Hiring increased in November in retail, manufacturing and transport, but in construction there was a slow down and a decrease in mining, which includes the energy sector. This may be reflecting a slowdown in home sales and a decrease in the demand for autos. There are also indicators of a drop in business investment, to an annual rate of 0.8 percent in this year’s third quarter, from 8.7 percent in the previous quarter ending in June.
These indicators coincide with the estimate by the Federal Reserve Bank of Atlanta that US economic growth will decline to 2.4 percent in this year’s last quarter, after two consecutive quarters of more than 3 percent. Furthermore, economists surveyed by The Wall Street Journal (12/06/18) project the US economy will grow 2.3 percent in 2019 and 1.8 percent in 2020.
The question is how the central bank will read these signals of deceleration at its last meeting of the year, in Washington on December 18 and 19.
*International analyst and consultant, formerDirector ECLAC Washington. Commentator on economic and financial issues for CNNen Español TV and radio, UNIVISION, TELEMUNDO and other media.
