A Jobless Recovery? Not this Time


Early this week a survey release by the National Association for Business Economics (NABE) provided new evidence that the U.S. recovery is solidly under way and will be sustained well into 2010. The best news of the survey is that now a majority of companies surveyed are planning to boost their payrolls this year and next.

For the first time in over a year, the percentage of businesses expecting to hire workers over the next half year exceeds the share that project more layoffs.

Additionally the majority of firms now foresee that they will spend more on new capital equipment in the next six months adding more fuel to the growing recovery in 2010.

The survey shows that companies are generally becoming more optimistic about the future. As initial claims for unemployment continue to fall, the survey results are one strong signal that a return to job growth for the US economy is just around the corner.

The NABE survey’s select group of retailers, health-care providers, hotels, restaurants, finance firms, insurance companies, and real estate employers all forecast job growth in 2010.

Much of the fuel for optimism has come from much better than expected results in Q3. Earlier in the year many economists had forecast lackluster results for Q3, but most firms have smashed those meager expectations. Since the start of the third-quarter reporting period, 80 percent of the companies in the S&Ps 500 Index have released better-than-expected results, according to Bloomberg, First Call, and Thomson earnings data. As a percentage so far, that’s the best quarterly showing in 16 years.

Not only are a majority of firms beating Q3 expectations, forecasting job creation, and upping capital expenditures, but every single company polled this month anticipates the economy will expand in 2010.

Surprise, surprise, surprise!

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