Hello, I'm Mark Pearson. A much-anticipated employment report released this week showing weaker-than-expected job growth, and a rise in the unemployment rate brought the bears of Wall Street out of hibernation.
According to the Labor Department, U.S. employers added a meager 8,000 jobs to their payrolls last month... their worst performance in more than four years. Meanwhile the nation's unemployment rate rose to its highest level in more than two years.
Coupled with crude oil prices which exceeded $100 per barrel briefly this week, the figures rattled already jittery investors and all the major stock indices finished lower for the holiday-shortened week.
The reports also renewed concerns that a slowdown in consumer spending could lead to a recession in 2008. Nevertheless, some sectors of the economy finished 2007 on a high note. That's especially true in rural America and a private study released this week reveals the Midwestern economy staged a rebound in December.
A weak dollar, aided by strong farm income and an upturn associated with alternative energy production have given the Mid-America Business Conditions index its largest single-month gain in five years. The index is compiled by Creighton University from information gathered from supply managers and business leaders. Geographically, the nine-state Midwestern region includes Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.
In December, the index soared to 55 from November's 49.2. A tally greater than 50 indicates an expanding economy over the next three to six months.
While record farm income and a jump in the employment index was noted in much of the Midwest, high-energy prices and problems in housing and credit markets have curbed economic optimism.
Rising energy costs have pushed the inflation index to its highest level in 10 months. And, according to the authors of the report, chances are better than 50 percent that the Federal Reserve will cut its rate when it meets again later this month.