This Week in Economic News: October 12 – October 16, 2020
ICYMI: Pandemic-era Labor Market Perpetually Beat CBO’s Expectations (And New Research Suggests A Rapid Recovery Is Here to Stay!)
- According to a recently published NBER working paper titled Temporary Unemployment and Labor Market Dynamics During the COVID-19 Recession, the labor market will reach a 5% unemployment rate by June 2021 – more than 5 years sooner than the CBO’s July 2020 baseline.
(About the Unemployment Rate: The unemployment rate measures the amount of joblessness an economy has as a percentage of its labor force.)
NFIB Small Business Survey
Small Business Optimism Reaches Historically High Level in September
- Small businesses reported high foot traffic, sales, earnings, and employee compensation in the previous month.
- More business owners planed on creating new jobs.
- Over 20% of small businesses reported that their biggest problem is finding qualified labor.
(About the NFIB Small Business Optimism Index: The NFIB Small Business Optimism Index provides an insight into small businesses’ sentiment and economic outlook on labor markets, capital spending, sales, etc.)
Retail Sales Beat Expectations During 5th Month of Continuous Growth
- Retail sales increased by 1.9% when economists expected 0.7% gain.
- Excluding auto sales, retail sales increased by 1.5% compared to the 0.4% expectation.
- Motor vehicle sales increased by 3.6% with used cars and truck sales experiencing its largest monthly increase since 1969.
(About Retail Sales: The Census Bureau reports monthly the amount of sales that occurred in retail and food services. This report provides a perspective on the health of the economy as more than two-thirds of the economy is fueled by consumer spending.)
Survey of Consumer Expectations (SCE)
Consumers Hold Optimistic Expectations Over September
- Consumers expect improvements in the job market.
- Consumers feel better about their own financial situations and expect to spend more.
- Consumers do not expect to be delinquent on their debt.
(About the Survey of Consumer Expectations: Composed by the Federal Reserve Bank of New York, the SCE surveys households’ views on job prospects, earnings, spending, access to credit, and their economic outlook.)
NAHB/Wells Fargo Housing Market Index, Housing Starts, Existing Home Sales
When: Monday, October 19, 2020; Tuesday, October 20, 2020; and Thursday, October 22, 2020
About the Housing Market Index: The Housing Market Index surveys NAHB members to give a sense of current and future housing market conditions.
About Housing Starts: Housing starts details the amount of new construction of residential buildings.
About Existing Home Sales: Existing home sales measure the amount of sales of previously constructed single-family homes, condos, and co-ops.
Federal Reserve Beige Book
When: Wednesday, October 21, 2020
About the Federal Reserve Beige Book: The Beige Book provides anecdotal information on the current state of the economy through key business contacts, economists, market experts and other sources from each Federal Reserve Bank district.