Tempus Fugit —PolischukJanuary 2012
It's that time of year … AGAIN! Time to "wring out the old and ring in the new." Where did 2011 go? Where did the first decade of the new century go, for that matter? Time flies, faster and faster—I'm convinced.
What a roller coaster ride 2011 turned out to be. For much of the year, our economy seemed to be teetering on the edge of falling back into recession. Although the year ended with some notes of optimism, it's hard to figure out if we're still "on a ride." Two news items I recently ran across make me believe we may have turned the corner.
The U.S. Bureau of Labor Statistics just released its employment data for December 2011. Having added 200,000 nonfarm payroll jobs during the month, the (seasonally adjusted) unemployment rate fell to 8.5 percent. This is the fourth month in a row that the unemployment rate has fallen (from 9.1 percent in August). You'd need to check with a statistician, but this could qualify as a legitimate trend. What I thought was particularly interesting was that the manufacturing sector added 23,000 jobs in December, after four months of relative stagnation. It would really be nice to see a legitimate trend of increasing employment develop in this category during the next few months.
In a separate, but somewhat related item, the December 31, 2011 issue of The Economist ran a report on American business and what it called the "flip side of the jobless recovery: the remarkable improvement in American productivity." It reported that American labor productivity (they spell it 'labour' for some reason!) was 2.3 percent higher in the third quarter of 2011 versus the same period in 2010, saying it was the fastest quarterly rise in 18 months.
To get a perspective on this, The Economist turned to the packaging industry, asking William Hickey, president and CEO of Sealed Air, how long American productivity improvements could continue. "I see no limit," he said. Hickey noted the "hefty gains" that could be made by incorporating more automation, and while worrying about diminishing returns, he said, "we haven't hit the wall yet."
So, what will 2012 bring? Discounting the predictions of the end of the world stemming from some interpretations of the Mayan calendar, I'm hoping that there is a correlation between these two news items. I'm expecting American businesses to continue improving productivity so they can compete favorably on the world stage. At the same time, I'm hoping that there is, in fact, a trend of increasing employment that will continue through the year and beyond. Then we won't have to talk about a jobless recovery anymore.
Tom Polischuk, Editor-in-Chief
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