SAUSALITO -- Sausalito-based TrimTabs, which accurately forecast very weak job growth for May, estimates the U.S. economy shed 152,000 jobs in June. The investment research firm said private sector hiring remained weak as the Census Bureau laid off 243,000 temporary workers.
The full TrimTabs release is below.
Sausalito – June 30, 2010 – TrimTabs Investment Research estimates that the U.S. economy shed 152,000 jobs in June. While the headline figure is negative, the job losses were due primarily to the layoffs of 243,000 temporary employees at the Census Bureau.
“The big news is that private sector added just 91,000 jobs in June, much less than the 150,000 needed to keep up population growth,” said Charles Biderman, CEO of TrimTabs. “Investors are starting to realize that the economy is going to grow a lot more slowly than forecast.”
In a research note, TrimTabs pointed out that multiple indicators suggest the economy is slumping. Real-time tax data shows wages and salaries are declining sequentially, growth in online job postings is slowing, initial unemployment claims are stubbornly high, and the housing market is weakening.
“Surging demand for homes and durable goods generally fueled strong economic recoveries in the past,” Biderman noted. “But now that the government has stopped doling out cash to people to buy houses, cars, and appliances, where’s the unfulfilled demand to boost the economy?”
Adding to the woes of the job market and the housing market, state and local governments face enormous budget deficits.
“Without huge tax increases or massive federal aid, 1 million to 2 million public sector employees could lose their jobs by the end of 2011,” said Biderman.
TrimTabs expects consumption to weaken over the near term because Congress failed to extend emergency unemployment benefits.
“We estimate that 2 million people will lose their unemployment benefits over the next two weeks,” said Biderman. “These benefits average $300 per week, so that means about $32 billion fewer dollars annually will be available for consumption.”