Ian Shepherdson Labor Quotations

With three sub-300,000 numbers in the past four weeks, it is beginning to look as though there has been some real improvement in the labor markets this year.

No doubt bears will highlight the rise in continuing claims, up another 29,000, but we are unmoved: A rising ratio of continuing to initial claims signals accelerating productivity growth, not a shaky recovery, ... Labor market conditions are improving -- but we still expect a soft payroll report Friday.

Only a few years ago, auto sales numbers like those seen recently would have automatically lead to expectations of higher prices, ... Now, increasing transparency in car prices, substantially due to the Internet, together with the automakers' ability to hold down unit labor costs, means that stronger sales do not necessarily lead to higher prices.

Only a few years ago, auto sales numbers, like those seen recently, would have automatically lead to expectations of higher prices, ... Now, increasing transparency in car prices, substantially due to the Internet, together with the automakers' ability to hold down unit labor costs, means that stronger sales do not necessarily lead to higher prices.

It is beginning to look as though there has been a real improvement in the labor market at the start of this year.

Overall, the labor market is improving, but progress is still slow,

With the fastest productivity growth and biggest drop in unit labor costs in seven years, the numbers are certainly worth shouting about, but as yet we are far from convinced that much of the improvement is structural. Mr. Greenspan is of the same view, which is why rates are going up no matter what happens to productivity growth.

The data confirm that the labor market is still not generating the sort of cost pressures many analysts expected with 4 percent unemployment.

Unfortunately, at current levels, and coupled with the extraordinarily low level of labor demand, the claims numbers are still consistent with flat or falling payrolls and a rising unemployment rate. There's no real relief in sight here yet.

Even though most people displaced by the storm are still away from their homes, Labor Department officials have been helping people make claims from their temporary accommodations.

At 296,000, claims have slipped back to a five-week low, ... This is simply too low a level to be consistent with a major change in the labor market.

These are spectacular numbers and confirm that the labor market is not at the moment the source of anything that could be plausibly described as inflationary pressure.

This is a sign that the committee is beginning to think aloud about shifting to a more neutral position - but the forecast of significantly slower growth will have to come first, ... For now, the elevated headline inflation rate and the tight pool of available labor remain bigger concerns, so the Fed's guard is still up.

It signals that the labor market has now moved again to center stage in the Fed's analysis and policymaking process.

The new Fed Chairman clearly expects to have to raise rates a bit further, but the extent of the tightening is dependent on the relative performance of the labor and housing markets.

The labor market is tightening, but the tightening is not accelerating.

The message from these claims numbers is strong and clear. The labor market is extremely tight.

The Fed's chief worry is still the labor market. So long as the unemployment rate does not fall further, and clear signs of consumer slowed own emerge, the Fed will be able to leave rates on hold.

The Fed's chief worry is still the labor market, ... So long as the unemployment rate does not fall further, and clear signs of consumer slowed own emerge, the Fed will be able to leave rates on hold.

Clearly, there is no near-term inflation threat coming from the labor market. In short, great numbers, which will prompt yet more talk of miracles.

Claims have now been essentially static for three months, so even if the latest declines turn out to be unsustainable, the data will still show that the trend is no longer rising rapidly, and may not be rising at all, ... It looks like the worst of the worst is now over in the labor market.

Behind the enormous distortions caused by the hurricanes, the underlying state of the labor market has continued to improve.

If claims remain anywhere near this week's level, they will send a very strong signal that the labor market is tightening.

The March Beige Book paints a clear picture of an economy straining at the seams. Significantly, compared to recent Beige Books, there was more detail, and a more worrying tone, to the comments on the labor market.

The headline was pulled down by slightly bigger declines in gasoline, natural gas and fuel oil prices than we expected. Core PPI is now up just 1.7% year over year, down from May's 2.8% peak. It will slow further in the wake of the slowing in raw-materials prices, but the Fed cares much more about the labor market than PPI.