As long as the United States keeps adding 200,000 plus jobs every month, analysts at the Market Watch says that there's no need to panic and that the danger of another recession is far away.
According to the latest March report, the United States has added about 210,000 jobs in March 2016 even though retail and manufacturing companies are hurting. The unemployment rate is expected to be stable in March marking an eight-year low of 4.9%.
How come there's a surge in hiring while nations are struggling? Market Watch has taken into account the slow but stable growth of the United States even though corporate profits have dwindled. American and global consumers are still purchasing enough goods and services to encourage companies to open more jobs for Americans to fill. The job openings mean there is a rise in demand that needs to be met.
"Consumer spending is a big positive thanks to job and income gains and low energy prices," explains Gus Faucher, deputy chief economist at PNC Financial Services.
Can this hiring trend continue across the year if corporate profits and investment are still weak? MW says, historically, retailers aren't doing quite as badly and sales have been soft but that's not the whole story. Consumer confidence is high and the trends are slow but positive.
One telltale sign: Consumers are borrowing more money. Consumer credit reports have peaked at $3.54 trillion in January, greatest at 6.5% compared to a year ago.
Another tell-tale sign: consumers are spending more money. Americans are also spending more on services such as travel or eating out, fueling an increase in hiring at hotels and restaurants. Spending on these leisurely activities typically rise when consumers are more confident about their job status and the overall economy.
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