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Posted by: Greg T. Spielberg on August 07
Let’s start from the top and move down. Nonfarm payroll fell 247,000 last month – the loss of workers hasn’t been so small since August 2008. Unemployment, now at 9.4%, is a tenth of a percent lower than last month. Giddy speculators – many of them pent up from riding the pine so long – cheered the respite of terrible news and invested heavily. According to Bloomberg, the value of U.S. equities is up $4 trillion because of this surge, and the Dow jumped 113.81 points to close at 9,370.07.
The auto sector actually brought on workers. In the motor vehicle and parts sector, 28,000 more employees entered the job market last month. The cash for clunkers (it no longer needs quotes) program helped spark annualized sales of 11.2 million autos. This is 13% growth over June’s numbers. Ford saw year-over-year gains (2%), a term that at times seems like a foreign language. “Year-over-year gains.” BusinessWeek writers David Welch and David Kiley note that Hyundai is even giving dealers advances of up to $4,500 until the government processed clunker applications. A move that signifies not only established lines of credit but the private sector’s faith in a government-run operation.
In Mishawaka, Ind., decal-maker Valley Screen Process realized a 50% increase in orders compared to June. President and CEO Karen Barnett’s business is less than 30 miles from Elkhart, Ind., the RV-capital that has been a symbol of America’s recession. President Obama has twice visited the hard-hit Midwestern town to barnstorm for his economic stimulus. Valley Screen Process counts on RVs for much of its business and Barnett recently told BW, “For the first time in over a year, I feel hopeful.”
BusinessWeek’s Joe Weber, Patricia O'Connell, Michelle Conlin, Frederik Balfour, Peter Coy, Greg Spielberg and Roger Crockett examine The Case for Optimism by looking past the financial turmoil and economic unrest gripping the globe to focus on the promising future that lies on the other side of this storm. We’ll chronicle the forward thinkers investing in R&D, launching promising new products, entering new markets, or implementing management and leadership.
See why BusinessWeek Editor-In-Chief Stephen J. Adler is optimistic about the economy amid the sharpest downturn since the Great Depression.