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April 1, 2004
Economy Still Steaming Forward

Two stories in today's USA Today demonstrate the strength of the economic expansion. Manufacturing, which the Democrats have used to beat George Bush over the head, turns out to be expanding even faster than the overall economy:

The Institute for Supply Management said its manufacturing index registered 62.5 in March compared with 61.4 in February. The new reading beat the expectations of most analysts, who had forecast a figure of 59.5. ... It was the 10th consecutive month of expansion in the sector, which makes up less than a fifth of the U.S. economy.

The ISM said its monthly employment index climbed to 57.0 versus February's 56.3. February's reading was its highest level since December 1987 [emph mine].

The ISM measures 20 manufacturing industries and reports expansion in all twenty. That may account for the dropping numbers of jobless claims, which indicate that companies have stopped trimming payrolls in the first quarter, which is traditional in retail markets especially, and are ramping up hiring to meet the needs of the expansion. In addition, inflation was non-existent during the same reporting period, which indicates a true expansion instead of simply wage and price puffery.

In short, while we are still waiting for extensive job creation, the stage has certainly been set for it. The economy is expanding at rates not seen in over fifteen years while keeping inflation under control, and the unemployment level still is below the average of the past two decades. John Kerry will have a tough time running against these numbers.

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Posted by Ed Morrissey at April 1, 2004 12:43 PM

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» Making Sense of Economic Reports from The Corpus Callosum
Confused by the recent employment figures, I went to Brad DeLong's site to se what he had to say about the fact that over 3x105 jobs were created last month, but the unemployment rate grew from 5.6% to 5.7%. Mr. DeLong points out that the job growt... [Read More]

Tracked on April 3, 2004 12:10 AM

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