Core business sales can't support 220,000 new jobs monthlyStaff writer ▼ | December 11, 2015
October’s core business sales fell by -0.3% from September 2015 and were up by merely 1.3% from October 2014.
Analysis Private-sector might do well to average 165,000 new jobs
Even if core business sales post back-to-back monthly increases of 0.5% in November and December, the metric’s yearly increase would drop from Q4-2014’s 5.1% and Q3-2015’s 1.8% to 1.5% for 2015’s final quarter, writes John Lonski, Chief Economist, Moody’s Capital Markets Research.
The latter would be the worst such performance by core business sales since the -4.2% yearly plunge of 2009’s final quarter.
During the mature phase of the previous two economic recoveries, core business sales slowest annual rates of growth by quarter were the 3.6% of Q1-2007 and the 2.3% of Q3-1998.
Unless core business sales accelerate sufficiently, private-sector payrolls’ average monthly increase of 220,000 new jobs for the year-ended November 2015 will prove to be unsustainable. Private-sector payrolls might do well to average 165,000 new jobs per month during the year-ended November 2016.
Moreover, the well below-trend performance by core business sales warns of a notable increase in the number of high-yield downgrades that is already well underway. ■