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Friday, Aug. 6, 2004

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  The payrolls figure and the unemployment rate can sometimes go in different directions because they are derived from two separate statistical surveys.

Economists, however, look more closely at the payroll figure as a better barometer of the health of the jobs market. The 32,000 net jobs added in July represented the smallest gain in hiring since December and followed a revised gain of just 78,000 in June, even less than previously reported. May's payrolls also were revised down to show a gain of 208,000.

Analysts were expecting the economy to add anywhere from 215,000 to 247,000 jobs in July. They were predicting the jobless rate to hold steady at 5.6 percent.

Federal Reserve Chairman Alan Greenspan, appearing before Congress last month, said that the economy hit a "soft patch" in June. But he expressed confidence that it would be short-lived.

Consumer Confidence Highest Since January

Consumer confidence surged during the past month to its highest level since the beginning of the year, with Americans feeling better about their own finances and more optimistic about the future despite renewed terror threats and rising oil prices.

Consumer confidence has been rising for the past four months as the economy has been on a solid path to recovery.

The AP-Ipsos consumer confidence index climbed to 104.8 in August, up from 92.0 in July, led by consumers' perceptions of their own finances and optimism about the future.

For Mike Mainello, a North Carolina businessman retired from the military, evidence of the improving economy is all around him.

"My wife sells new homes to first-time home buyers. They're buying right and left," said Mainello, a 45-year-old conservative Republican from Winston-Salem. "We're finally paying off bills faster than we're incurring them."

The AP-Ipsos survey of consumer attitudes by spending and household found a surge of economic optimism that has shown up in several recent measures of consumer attitudes.

Though months of steady improvement in the job market has fueled some optimism, the AP-Ipsos index found the increase this time was based more on people's improved perceptions of their own finances, and their view of how their local economy will be doing six months from now.

The snapshot of consumer sentiment found Americans considerably more upbeat about the economy than a year ago, when the index was at 89.0. Much of the improvement came during the past month, however.

The AP-Ipsos confidence index is benchmarked to a 100 reading on January 2002, the month the index was started by Ipsos.

Lynn Staggs, a 33-year-old saleswoman from Austin, Texas, said she could sense the economy was doing better just from looking around her neighborhood on the way home.

"It seems like the housing market is doing better. I don't see as many houses around here for sale," said Staggs, a political independent. "I see a lot of people in my neighborhood turning up with new cars and making big purchases."

Staggs said she thought the tax cuts of the past couple of years helped people save money and make purchases.

© 2004 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.

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