Also of note: Inventory stabilization or growth is all well and good, but that growth will only continue if demand picks up and sales grow. Otherwise they will simply reach a new stalling point. And soon. Likewise, employment will not bottom out until demand grows.

Why do they move off shore? Its too EXPENSIVE to produce things here…..so what policy is OBAMA trying to implement…….CAP AND TAX or EPA regulations which will make producing things TO EXPENSIVE.

Why hire when there is a good chance the epa is going to sock it to producing business with higher taxes which they will have to pass on to an already strapped America because its GOOD for the GREENIACS in the progressive wing of the party.

Cap and tax or EPA regulations in its inception is designed to send EVEN MORE jobs overseas. Corporations right now are taking a wait and see attitude on the economy instead of hiring even though people themselves are showing signs of starting to spend.

As far as Obama and his progressive administration. They are wrong. Their very policies are designed to right the injustices that are perceived to be perpetrated by corporations whose very role is to provide jobs and provide a profit. Companies are returning to being profitable and yet jobs are not returning.

The reason is simple….they are afraid of an administration who espouses the mantra you just preached at me Terence……

Which after reading it for the 3rd time says and Ill paraphrase it.

Corporations are evil and they MUST PAY. Why would I want to stay in America if I was struggling, having to pay exorbitant benefits and wages and being forced to struggle on burdening legislation that sees me fired by presidents, or worse……..threatened with lawsuits and jailtime.

And that was under a GOP administration that was favorable to corporations………Imagine their trepidation now.

I get it. I just dont think the progressives do.

The other side of that statement is that big business uses it’s power and political influence to help create the laws most beneficial to it, while acting to stifle competition by making the entrance into these industries prohibitively expensive for “up and comers”. Meanwhile their political pressure and money derail any type of National Industrial Policy that balances labor and employment rights with pro-business growth initiatives. Human rights discussions do not take a place at the “table” when things like taxes, tariffs, and credits for off-shoring American jobs become a legal loop hole for a company to move it’s labor overseas but import it’s products as if they were made in this country.

Your statement that “Until this administration starts working with and showing an affinity for Business in this country we will continue to waller in squalor” is exceedingly narrow and based on economic theory that is ineffectual. I don’t know any elected leader that is against Main Street capitalism, whereby there are lot’s of small Mom and Pop businesses all providing goods and services in a mutually beneficial exchange relationship. It’s good for the economy. However, big business has the money and political influence while small business doesn’t.

Big business operates on a global scale while small business doesn’t – and yet they are both required to operate by essentially the same rules. Big business is allowed the same rights as natural born people, small business is typically made up of nothing but natural born people – and they operate their businesses accordingly. It’s easy to say that government is against business, it’s equally easy to say that good government should operate as a check and balance against the excesses of big businesses and political power. If you look at that statement it’s clear that big business is winning while small business is losing (and has been for decades) – no matter which political philosophy is currently wielding the hammer of power.

As it stands the progressives hate big business. They want to penalize big business. They want to tax big business. They want to legislate big business into being something in America it is not.

Big business fuels the economy. Small business drives it.

Neither are hiring because both understand that just around the corner, one vote short is a death screech to the entire recovery. Just around the corner is the Democrats 60 vote filibuster proof, big business sanctioning war cry of “WE HATE CORPORATIONS!!!”

Debate it all you want…….it is in fact the truth. Until this administration starts working with and showing an affinity for Business in this country we will continue to waller in squalor.

Jimmy Carter did it in the 70′s and the economy was a horrid wreck. Obama is doing it and the economy is a horrid wreck. When will the Democrats…….not progressives….but the Democrats ever learn that Progressive policies are just plain bad for business in America unless we fundamentally want to reshape the entire process in this country.

Oh wait…….that is precisely what Obama and his Progressive administration is trying to do.

My Bad.

“Economy Grew 5.7% Last Quarter”

No, it didn’t. GDP increased at an annualized rate of 5.7% last quarter. That’s an actual GDP increase of 1.4% for the quarter over the previous quarter’s GDP. BUT … most of that was from a slowdown in inventory liquidations. Which doesn’t exactly imply strong demand. Actual GDP growth from previous quarter without inventory adjustments was 2.2% (annualized), or 0.55% actual growth. That’s a touch over half a percent, not nearly six percent.*

Still an improvement, but hardly electrifying. The best news really is two consecutive quarters of non-falling GDP, implying that the shrinkage has mostly abated and stabilization is taking place. At a more micro level, it’s more good news that consumer spending grew a touch without the illusory boost of Cash for Clunkers. (However, one does note that it was the holiday season.) The really good news is that business investment increased a bit for the first time in well over a year.

But with news like this my guess is that employers will start adding staff.

Um, no. Not until they actually have the demand pressure that requires extra staffing, and then they’ll still be very cautious. As long as the admin and Congress leave future taxation changes and such up in the air, the uncertainty level will continue to retard employment. Employers are in no hurry to add more overhead when they don’t know what it will cost them, or if the demand for output will really be there. That’s why employment is a lagging indicator in the first place — businesses do not boost overhead unless they expect that investment to pay a profit, and the more uncertain the business environment is in the immediate future, the more reluctant they are.

And given the current levels of unemployment, absolutely NO ONE is worried about being unable to find qualified employees, so there’s no pressure to snap up people just because they have good job skills.

[*--Had GDP actually grown 5.7% last quarter that would translate to a 24.8% annualized rate of growth. If that happened, the Federal Reserve would be pumping up interest rates in major chunks to control expected inflation, and the stock markets would be going crazy. And it would probably not be a good thing, because it would radically increase the odds of an even more severe boom/bust cycle in the immediate future.]

Do you think we can get something for nothing? There are consequences to this administrations behavior that will be far worse than anything we’ve currently experienced. Don’t be a fool.

I thought it was good for our site. It helped build a sense of good faith among the commenters.

Employment is a lagging indicator, and it’s more than that. Even if this good news endures over coming quarters, it’s pretty likely that industries that saw the most downsizing will be working from a “new normal” model which includes lower levels of permanent staffing.

The jobs that slowly replace the lost ones will quite possibly not be as good on average: More contract and temporary work, lousier benefits. Companies that asked for and got sacrifices from retained employees (like to pay higher portions of healthcare, to accept lower or no 401k matches) will be very slow to restore those things, if they even contemplate it.

I really hope this a beginning of a sound turnaround. But I would need to see 3 quarters of sustained growth. And that makes sense, right? If we need several quarters of decreased growth to declare a recession, then I think we need several of increased growth to call it truly over.

I do think that pent up consumer demand will look for excuses to let go. Remember, we added 5 or 6% of the population to a steady baseline of 4 to 5% unemployment. Adding in the “not seeking work”unemployed, this means that for roughly 85% of Americans, the recession was primarily emotional. Outside of paper losses on retirement money and other investments, they did ok.

It’s the folks who lost their jobs who are experiencing the majority of ongoing pain. The other 85% are ready to go back to the old normal. The new normal will be for folks still unemployed.

Return of consumer demand, BTW, is what could ignite inflation, and what would have to be attacked with higher interest rates. And higher interest rates are exactly what will make it harder for new enterprises to add jobs. But it becomes a choice of choosing which horn of the bull you want to do the goring.