Page 7 - Aruba Today
P. 7
U.S. NEWS A7
Friday 6 November 2015
US regulators: US Financial Front:
Still heavy risk in
big bank loans American jobless aid rises but still near historic lows
MARCY GORDON JOSH BOAK A’GACI clothing store hiring manager Marcie Lowe, right, gives her card to job applicant Xionara
AP Business Writer AP Economics Writer Garcia, left, of Miami, during a job fair at Dolphin Mall in Miami. According to Labor Department
WASHINGTON (AP) — Fed- WASHINGTON (AP) — More statistics released Thursday, Nov. 5, 2015, more Americans applied for unemployment benefits a
eral regulators say they’re Americans applied for un- week earlier, but levels remain near historic lows as employers are hesitant to let go of workers.
still seeing a heavy dose of employment benefits last
risk in large loans made by week, but levels remain (AP Photo/Wilfredo Lee)
banks and other financial near historic lows as em-
institutions, despite the re- ployers are hesitant to let 182,000 jobs last month. This economic growth abroad ment.
covering U.S. economy. go of workers. would follow a sharp slow- have weighed on the U.S. As a result, the economy
The Federal Reserve and The Labor Department down in hiring in September economy since August. grew at a tepid annual rate
other agencies cite on- said Thursday that a sea- and August when hiring av- U.S. factory output has also of just 1.5 percent over the
going loose lending stan- sonally adjusted 276,000 eraged just 139,000 jobs, a dropped because lower summer, the Commerce
dards and an increase in people sought jobless aid sharp slowdown from gains energy costs have led oil Department said last week,
loans made for financing last week, up from 260,000 earlier in the year that rou- and gas drilling companies down from a much health-
takeovers of companies. in the prior week. The four- tinely exceeded 200,000. to reduce their spending ier pace of 3.9 percent in
Those loans are risky be- week average, a less vola- The strong dollar and weak on machinery and equip- the April-June period. q
cause they can greatly tile measure, rose 3,500 to
exceed the amount of a 262,750.
firm’s earnings. Jobless claims are a proxy
The steep decline in oil for layoffs. Recent multi-
prices over the past year decade lows indicate
has hurt many energy that employers expect
companies. Loans in the the economy to continue
industry are at greater risk to improve despite glob-
of souring or are already in al pressures on growth,
default, according to the prompting them to hold
agencies’ 2014 annual re- onto workers. The four-
view. week average has stayed
The review found that below 300,000 since late
banks are making progress March, achieving levels
in improving their credit traditionally linked with a
standards. But there are healthy job market.
“continuing gaps” be- The government releases
tween industry practices the October jobs report Fri-
and standards of bank day. Economists surveyed
safety, it said. by FactSet expect that
Overall, the review found employers added a net
that loans at risk of failing
or already in default, plus US productivity levels slow in 3rd quarter
those showing potential
weakness, remained high MARTIN CRUTSINGER cent in the third quarter Macroeconomics, said that high-tech products that
at 9.5 percent of the total AP Economics Writer after having fallen at a 1.8 the productivity gain for helped workers do their
$3.9 trillion in large loans. WASHINGTON (AP) — U.S. percent pace in the sec- the third quarter was much jobs more efficiently. But in
Loans in that category productivity slowed in the ond quarter. better than expected but recent years, productivity
were up 9.4 percent from summer, while labor costs Productivity, the amount described the long-term growth has slowed signifi-
$340.6 billion last year. rebounded yet stayed at a of output per hour of work, trend as disappointing. cantly.
Loans in the oil and gas level suggesting only mod- has slowed significantly in “All we can say for sure is Some economists believe
industry represent about 7 est inflation pressures. recent years. Economists the productivity growth is that reflects a temporary
percent of total large loans Productivity rose at an an- are divided on the causes very slow, showing no sus- drop in business investment
outstanding. The credit nual rate of 1.6 percent in for the weakness. Over the tained signs of revival,” in new equipment, and
problems could spread the July-September quar- past year, productivity is up Shepherdson said. they forecast a rebound
to the service companies ter, a slowdown from a 3.5 just 0.4 percent compared Productivity saw a jump for in productivity growth to
that cater to the industry percent increase in the to average annual growth a decade starting in 1995, higher levels. However, oth-
and banks should closely second quarter, the Labor of 2.2 percent from 1947 gains that were attributed er analysts worry that the
watch that area, agency Department said Thursday. through 2014. to improvements in com- country could be stuck in a
officials said in a confer- Labor costs rose at a mod- Ian Shepherdson, chief puter software and the in- prolonged period of weak
ence call with reporters. est annual rate of 1.4 per- economist at Pantheon troduction of a number of productivity growth.q
