Like the rest of the economy, the job market is caught in a squeeze, as interest rates inch higher and gasoline prices show no evidence of abating.
So far, those forces have done very little to slow activity.
For those seeking work, however, the question is whether companies that have been boosting payrolls soon will feel the pressure from both directions.
Economist Brian Wesbury doesn’t see any evidence of that, just yet. He expects Friday’s employment report for August to show a drop in joblessness to 4.9 percent, from 5 percent a month earlier. And he is looking for payroll growth of 215,000 positions, on top of 207,000 in June.
“People are doing a lot of complaining about high oil prices, but they aren’t very worried,” said Wesbury, of Claymore Advisors in Lisle.
One explanation, he said, is that people are spending only about 4.8 percent of their incomes for energy, while it consumed 6.2 percent of their incomes 25 years ago.
“Our country’s industrial production recently hit an all-time high, yet we are using fewer people to create all that stuff,” Wesbury said. “And we continue to create many thousands of jobs more than we are losing.”
Boost on way? At this stage in the economic recovery–it’s more than 4 years old–anything that saps consumer confidence is worrisome.
According to economist Scott Anderson, attitudes among buyers are “in a holding pattern that dips … in time with every uptick in oil prices.”
For now, Anderson, of Wells Fargo & Co. in Minneapolis, says “spending on leisure and entertainment is most at risk, as consumers cut back on the number of movie and restaurant visits they make per month.”
Watch for Tuesday’s confidence index reading from the Conference Board to show slight slippage, to around 102 from 103.2 a month earlier.
On Friday, an equivalent report from the University of Michigan showed a decline in August consumer attitudes to 89.1 from 96.5 in July. Expectations for future months also fell.
More Top Picks Best Oolong Teas For Beginners
———-