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Category: Money

As Factory Activities Increase, Job Opportunities Grow

Written on February 02, 2011 by Japhet Writ

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Factory activities rise at its fastest pace since May 2004, making hopes for job growth go higher.

With US’ having its best month in almost seven years, the outlook for job growth brightens. Many companies are exporting more construction and mining equipment, while Americans are buying more cars, appliances and computers.

According to a private trade group, Institute for Supply Management, their index of manufacturing activities increased to 60.8 last month. The strong data on factory activities was one of the main reasons Dow Jones’ industrial average closed for more than 12,000 for the first time since June 2008. Therefore, factories are more likely to crank out jobs this time around.

There is high expectation that the manufacturing industry will add about 10,000 – 15,000 jobs a month for early 2011. One reason is that new orders, exports and backlogs have gained last January. This suggests that will create more output in the months to come. Another is that the manufacturing industry benefits from the tax cuts in Social Security. This may boost consumer spending and companies that purchase new machineries. In addition to this, also take advantage of rising overseas sales. The index of export orders revealed a jump from 54.5 to 62 in January.

Other than that, the price index of manufacturing companies that buy more raw materials skyrocketed. This can be a sign that inflation could pick up soon. Is US recovering from economic crisis already?

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