The National Association for Business Economics has just released its NABE April 2010 Industry Survey and it finally looks like the U.S. economy is starting to move forward again. Unfortunately, the survey also finds that the $787,000,000,000 economic stimulus package had very little to do with the improvement.
$787B and nothing to show for it!
What? We spent $787 Billion and we got nothing to show for it? Imagine that!
According the the NABE survey, 73% of responding economists from around the country belief that the Fed's stimulus bill from February 2009 has had no impact on employment.
Once again, American business owners and workers deserve the credit for getting our economy back on track. And, while American business took action, the government looked busy, spent a lot of money, and failed to do anything meaningful.
When will we learn that government is not the answer?
If you divide $787B by the approximately 150,000,000 taxpayers in this country, that means that each of us taxpayers had to pay $5,246 for this stimulus package. That should piss you off. It sure does me.
My family holds ourselves to a pretty strict budget every month, unfortunately our government does not.
Well, enough with the rant. There is a lot of good news in the NABE survey. The economy is starting to improve, companies are starting to hire again, and profits are on the rise. Here are some of the highlights from the report:
- Industry demand increased for a third consecutive quarter. Fifty-seven percent (57%) of April survey respondents reported rising demand versus only 6 percent reporting falling demand as the NRI jumped to its highest level in more than four years to 51. All four major industry sectors experienced strong demand growth.
- More than half of the NABE survey respondents said that some portion of their firms’ sales came from foreignbased operations, with 14% indicating that more than half of their sales were from foreign sources. Of those with sales from foreign operations, 42% indicated their sales increased in the last quarter, while 17% reported they decreased.
- Expectations for economic growth in 2010 have improved significantly. All NABE panelists again indicated business decisions are being made based on expectations for positive economic growth (as measured by real GDP) in 2010. Twenty-four percent (24%) of survey respondents believe real GDP will expand by more than 3%, and 70% of respondents believe the economy will expand by more than 2.0% in 2010.
- Profit margins expanded for the third quarter in a row. Twenty-five percent (25%) of survey respondents reported increased profitability versus 11% that reported declines. Three of the four major sectors posted higher margins than in January. Slightly more firms than in the previous quarter (18% vs. 17%) cut prices than raised them. This is a reversal from results in the past two surveys. In addition, fewer firms expect to raise prices in the coming quarter than had expected to do so in the January survey.
- Job creation increased for the first time in the past two years of this NABE survey. The percentage of firms increasing payrolls rose to 22% from 13% in the January survey. The percentage of firms cutting jobs moved lower—from 28% in January to 13% in April. The share of respondents expecting their firms to add employees over the coming six months rose to 37%, up from 29% in the previous survey.
- The share of respondents whose firms increased their capital spending over the prior quarter held nearly steady from the past two surveys—at 25%. Expectations for future capital spending deteriorated after improving for five straight quarters, although positive responses still exceeded negative ones by 41% to 22%. As in the past four surveys, expectations were positive for spending on computers and communications equipment, but negative for spending on structures.
- Materials costs continue to rise. The percentage of respondents reporting rising prices outpaced that of respondents reporting price declines. Labor cost pressures also continued to increase, with respondents reporting the highest NRI in more than two years.
- Credit conditions continue to hamper firms. Despite improvements throughout the economy, a large share of respondents continue to report that credit conditions had a negative impact on their businesses during the first quarter of 2010.
- The vast majority (73%) of respondents reported the fiscal stimulus enacted in February 2009 has had no impact on employment to date. While 68% also believe a jobs bill, such as the one recently enacted into law, will have no impact on payrolls, 30% do believe it will boost payrolls moderately.
Are you starting to see the economy starting to improve where you live?
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{ 3 comments… read them below or add one }
I certainly do not believe that the economy is turning around. There is no sign here, just the opposite. Businesses are folding, people are losing their homes, prices are going up, and good luck finding a job. Once all the ’stimulus’ money is gone, depression 2.0 will really pick up steam.
Here in my township, there were 52 home sales last year, and 22 foreclosures. There were 13 housing starts last year, and prior to 2008 the average ran about 115 housing starts. The contractors are out of work, the wood cutters are out of work, the carpet layers are out of work, the real estate agents are all working at the 7-11, and crime is on the upswing.
If you really want to know whats happening with the economy, I recommend George Ure’s sites urbansurvival.com peoplenomics.com; and shadowstats.com. Oh, and don’t forget to look out your window.
If the A-holes in CONgress lead by our fake president get their way with the VAT, we have no hope at a real recovery in the next 20 years.
I sure hope that you are wrong about the economy. I think that housing will continue to struggle for a while, but hopefully employment will go up in other areas.
I agree. it did nothing for the economy. total waste.