U.S. weekly unemployment claims rise; imported inflation weak

FILE PHOTO: People wait in line to attend TechFair LA, a technology job fair, in Los Angeles, California, U.S., January 26, 2017. REUTERS/Lucy Nicholson/File Photo

By Lucia Mutikani

WASHINGTON (Reuters) – The number of Americans filing applications for unemployment benefits unexpectedly rose last week, which could add to concerns that the labor market was losing steam after job growth slowed sharply in May.

Other data on Thursday showed import prices fell by the most in five months in May amid a broad decline in the cost of goods, the latest indication of muted inflation pressures. Signs of a slowing labor market and tepid inflation strengthen the case for the Federal Reserve to cut interest rates this year.

U.S. central bank policymakers are scheduled to meet on June 18-19 against the backdrop of rising trade tensions. Financial markets have priced in at least two rate cuts by the end of 2019. A rate cut is not expected next Wednesday.

Initial claims for state unemployment benefits rose 3,000 to a seasonally adjusted 222,000 for the week ended June 8, the Labor Department said on Thursday. Economists polled by Reuters had forecast claims decreasing to 216,000 in the latest week.

While layoffs remain relatively low, the third straight weekly increase in claims suggests some softening in labor market conditions. The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, rose 2,500 to 217,750 last week.

The economy created only 75,000 jobs in May, with annual wages increasing at their slowest pace in eight months, the government reported last week. U.S. financial markets were little moved by the claims data.

The slowdown in hiring, which occurred before a recent escalation in trade tensions between the United States and China, raised fears of a sharp deceleration in economic growth. The claims data is being closely monitored for signs of any fallout from the trade war.

President Donald Trump in early May imposed additional tariffs of up to 25% on $200 billion of Chinese goods, prompting retaliation by Beijing. Trump on Monday threatened more duties on Chinese imports if no deal was reached when he meets Chinese President Xi Jinping at a G20 summit later this month in Japan.

A tariff on all goods from Mexico to force authorities in that country to stop immigrants from Central America from crossing the border into the United States was narrowly averted after the two nations struck an agreement late on Friday.

ECONOMY SLOWING

Data so far have suggested a sharp slowdown in U.S. economic growth in the second quarter after a temporary boost from exports and an accumulation of inventory early in the year. In addition to the sharp moderation in hiring last month, manufacturing production, exports and home sales dropped in April, while consumer spending cooled.

The Atlanta Fed is forecasting gross domestic product increasing at a 1.4% annualized rate in the April-June quarter. The economy grew at a 3.1% pace in the first quarter.

In another report on Thursday, the Labor Department said import prices dropped 0.3% last month, the biggest decline since last December, after edging up 0.1% in April.

Economists had forecast import prices slipping 0.2% in May. In the 12 months through May, import prices fell 1.5% after decreasing 0.3% in April. The report came on the heels of data on Wednesday showing consumer prices remained tame in May.

Import prices exclude duties. In May, prices for imported fuels and lubricants declined 1.0% after rising 1.7% percent in the prior month. Imported food prices dropped 0.8% last month after surging 2.7% in April.

Excluding fuels and food, import prices slipped 0.2% in May after falling 0.3% in the prior month. So-called core import prices decreased 1.5% in the 12 months through May. Though the dollar has weakened a bit this year, its gains last year against the currencies of the United States’ main trading partners continue to depress core import prices.

The cost of imported capital goods declined 0.1% last month. Prices for imported consumer goods excluding automobiles was unchanged. The cost of goods imported from China edged down 0.1% last month after falling 0.2% in April. Prices fell 1.4% in the 12 months through May, the largest drop since February 2017.

The report also showed export prices fell 0.2% in May, with prices for both agricultural and nonagricultural products dropping. Export prices nudged up 0.1% in April. They fell 0.7% on a year-on-year basis in May after gaining 0.2% in April. Soybean prices tumbled 20.6% year-on-year.

(Reporting By Lucia Mutikani; Editing by Andrea Ricci)

Weak U.S. employment report casts pall over economy

FILE PHOTO: Brochures are displayed for job seekers at the Construction Careers Now! hiring event in Denver, Colorado U.S. August 2, 2017. REUTERS/Rick Wilking/File Photo

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. job growth slowed sharply in May and wages rose less than expected, raising fears that a loss of momentum in economic activity could be spreading to the labor market, which could put pressure on the Federal Reserve to cut interest rates this year.

The broad cool-off in hiring reported by the Labor Department on Friday was even before a recent escalation in trade tensions between the United States and two of its major trading partners, China and Mexico. Analysts have warned the trade fights could undermine the economy, which will celebrate 10 years of expansion next month, the longest on record.

Adding a sting to the closely watched employment report, the economy created far fewer jobs in March and April than previously reported.

The economy thus far has been largely resilient to the trade war with China. President Donald Trump in early May slapped additional tariffs of up to 25% on $200 billion of Chinese goods, which prompted retaliation by Beijing.

Last week, Trump said he would impose a tariff on all goods from Mexico in a bid to force authorities in that country to stop immigrants from Central America from crossing the border into the United States. Talks are ongoing to prevent the duties from kicking in at 5% on June 10.

Fed Chairman Jerome Powell said on Tuesday the central bank was closely monitoring the implications of the trade tensions on the economy and would “act as appropriate to sustain the expansion.”

“Today’s report makes a cut more likely, and supports our view that the trade tensions will ultimately slow growth enough for the Fed to respond in September and December with cuts,” said Joseph Song, an economist at Bank of America Merrill Lynch in New York.

Nonfarm payrolls increased by 75,000 jobs last month, the government said in its closely watched employment report, falling below the roughly 100,000 needed per month to keep up with growth in the working-age population.

Economists polled by Reuters had forecast payrolls rising by 185,000 jobs last month. Job growth in March and April was revised down by 75,000.

In the wake of the weak report financial markets priced in a rate cut as early as July and two more later this year. U.S. Treasury prices rallied, while the dollar dropped against a basket of currencies. Stocks on Wall Street were trading higher.

May’s disappointing job growth was flagged by a report on Wednesday from payrolls processing firm ADP showing the smallest gain in private payrolls in nine years last month. Another report this week showed a drop in online ads by businesses looking for help.

Last month’s slowdown in job gains, however, probably understates the health of the labor market as measures such as weekly applications for unemployment benefits and the Institute for Supply Management’s services employment gauge have suggested underlying strength.

WORKER SHORTAGES

Some of the weakness in hiring last month could be the result of worker shortages, especially in the construction, transportation and manufacturing sectors.

Monthly wage growth remained moderate in May, with average hourly earnings increasing six cents, or 0.2% following a similar gain in April. That lowered the annual increase in wages to 3.1% from 3.2% in April. The average workweek was unchanged at 34.4 hours last month.

The moderation in wage gains, if sustained, could cast doubts on the Fed’s optimism that inflation would return to the U.S. central bank’s 2% target.

The tepid employment report added to soft data on consumer spending, business investment, manufacturing and homes sales in suggesting the economy was losing momentum in the second quarter following a temporary boost from exports, inventory accumulation and defense spending. Growth is cooling as the massive stimulus from last year’s tax cuts and spending increases fades.

The Atlanta Fed is forecasting gross domestic product rising at a 1.5% annualized rate in the second quarter. The economy grew at a 3.1% pace in the first quarter.

The unemployment rate remained near a 50-year low of 3.6% in May. A broader measure of unemployment, which includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment, dropped two-tenths of a percentage point to 7.1% last month, the lowest since December 2000.

The labor force participation rate, or the proportion of working-age Americans who have a job or are looking for one, was unchanged at 62.8% last month.

Hiring slowed across all sectors in May. Manufacturing payrolls increased by 3,000 last month, after gaining 5,000 positions in April. The sector is struggling with an inventory overhang that has resulted in businesses placing fewer orders at factories.

Manufacturing payrolls will be watched closely for signs of any fallout from the trade tensions. Factory output has weakened and sentiment dropped to a 31-month low in May, with manufacturers worried mostly about trade.

Employers in the construction sector hired 4,000 workers in May after adding 30,000 jobs to payrolls in April. Leisure and hospitality sector payrolls increased by 26,000 jobs last month.

Professional and business services employment rose by 33,000. Transportation and warehousing payrolls fell as did retail employment. Government shed 15,000 jobs, the most since January 2018.

(Reporting by Lucia Mutikani, Editing by Andrea Ricci)

U.S. job openings surge, point to tightening labor market

FILE PHOTO: Job seekers line up at TechFair in Los Angeles, California, U.S. March 8, 2018. REUTERS/Monica Almeida

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. job openings rebounded sharply in March, while the pace of hiring was little changed, pointing to a growing worker shortage that could slow employment growth this year.

Despite the tightening labor market conditions, the report from the Labor Department on Tuesday also showed workers still reluctant to voluntarily quit their jobs in droves to seek opportunities elsewhere. The scarcity of workers poses a risk to the economy’s growth prospects. The economy will mark 10 years of expansion in July, the longest in history.

“The risks right now for the economic outlook going forward is there is actually a danger that companies will run out of the help they need to produce goods or sell their services,” said Chris Rupkey, chief economist at MUFG in New York.

“The U.S. economy has never faced a time when labor shortages might endanger or cut short a long economic expansion, but now it does.”

Job openings, a measure of labor demand, surged by 346,000 to a seasonally adjusted 7.5 million, the Labor Department’s monthly Job Openings and Labor Turnover Survey, or JOLTS, showed. The job openings rate rose to 4.7 percent from 4.5 percent in February.

Vacancies in the construction industry increased by 73,000 in March. There were 87,000 job openings in the transportation, warehousing and utilities sector, while real estate, rental and leasing companies had 57,000 unfilled position. Job openings in the federal government, however, decreased by 15,000 in March.

HIRING LAGGING

Hiring was little changed at 5.7 million in March. The hiring rate was steady at 3.8 percent. The lag in hiring suggests employers are experiencing difficulties finding qualified workers, a trend that implies a slowdown in job growth later this year.

There is growing anecdotal evidence of worker shortages, especially in the transportation, manufacturing and construction industries. The economy created 263,000 jobs in April, with the unemployment rate dropping two-tenths of a percentage point to 3.6 percent, the government reported last Friday.

Economists expect job growth to slow to about 150,000 per month this year, still well above the roughly 100,000 needed to keep pace with growth in the working age population.

In March, there were 0.83 job seekers for every job opening. Job openings exceeded the number of unemployed by 1.3 million. Vacancies have outpaced the unemployed for 13 straight months.

The number of workers voluntarily quitting their jobs was little changed at 3.4 million in March, keeping the quits rate at 2.3 percent for a 10th straight month.

The quits rate is viewed by policymakers and economists as a measure of job market confidence. The Federal Reserve last week kept interest rates unchanged and signaled little desire to adjust monetary policy anytime soon.

“You have to hand it to the business community. Despite being on the wrong side of the tight labor market, firms are managing to keep from a major bidding war for workers and are still not losing workers to competitors,” said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania.

Layoffs slipped in March, lowering the layoffs rate to 1.1 percent from 1.2 percent in the prior month. Layoffs fell in the government sector, but rose slightly in manufacturing and construction. The increase in manufacturing layoffs likely reflected redundancies in the automobile sector, which is experiencing slowing sales and an inventory overhang.

“Layoffs and discharges are extremely low, by historical standards, which reflects that employers need their workers and are prepared to make an effort to retain them,” said Julia Pollak, labor economist at employment marketplace ZipRecruiter.

(Reporting By Lucia Mutikani; Editing by Chizu Nomiyama and Andrea Ricci)

U.S. weekly unemployment claims lowest since 1969

FILE PHOTO: A "Help Wanted" sign sits in the window of a shop in Harvard Square in Cambridge, Massachusetts, U.S., February 11, 2019. REUTERS/Brian Snyder/File Photo

WASHINGTON, (Reuters) – The number of Americans filing applications for unemployment benefits dropped to a 49-1/2-year low last week, pointing to sustained labor market strength that could temper expectations of a sharp slowdown in economic growth.

Initial claims for state unemployment benefits fell 8,000 to a seasonally adjusted 196,000 for the week ended April 6, the lowest level since early October 1969. Claims have now declined for four straight weeks. Data for the prior week was revised to show 2,000 more applications received than previously reported.

Economists polled by Reuters had forecast claims would rise to 211,000 in the latest week. The Labor Department said no states were estimated last week.

The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 7,000 to 207,000 last week, the lowest level since early December 1969.

The labor market is the main pillar of support for the economy, which appears to have lost momentum in the first quarter as the stimulus from a $1.5 trillion tax cut package fades and a trade war between China and the United States and softening global demand hurt exports.

Nonfarm payrolls increased by 196,000 jobs in March, well above the roughly 100,000 needed per month to keep up with growth in the working-age population. The unemployment rate is at 3.8 percent, close to the 3.7 percent Federal Reserve officials project it will be by the end of the year.

Thursday’s claims report showed the number of people receiving benefits after an initial week of aid decreased 13,000 to 1.71 million for the week ended March 30. The four-week moving average of the so-called continuing claims dropped 11,000 to 1.73 million.

(Reporting by Lucia Mutikani Editing by Paul Simao) ((Lucia.Mutikani@thomsonreuters.com; 1 202 898 8315; Reuters Messaging: lucia.mutikani.thomsonreuters.com@reuters.net)

U.S. job openings hit 11-month low; quits rate stagnates

FILE PHOTO: A "Help Wanted" sign sits in the window of a shop in Harvard Square in Cambridge, Massachusetts, U.S., February 11, 2019. REUTERS/Brian Snyder/File Photo

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. job openings dropped to an 11-month low in February and hiring decreased, which could partially explain a sharp slowdown in job growth during that month.

Still, the labor market remains a pillar of support for the economy amid signs that activity was easing because of the fading boost from a $1.5 trillion tax cut package and the effects of interest rate increases over the last few years. The economy is also facing headwinds from slowing global growth and the United States’ trade war with China.

“The February job openings data reinforced that the labor market weakened in February but there isn’t any cause for concern,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania.

Job openings, a measure of labor demand, tumbled by 538,000 to a seasonally adjusted 7.1 million, the Labor Department said in its monthly Job Openings and Labor Turnover Survey, or JOLTS, report on Tuesday. The drop was the biggest since August 2015. The level was the lowest since March 2018.

Vacancies in the accommodation and food services industry fell by 103,000 jobs in February. There were 72,000 fewer job openings in the real estate and rental and leasing sector. Job openings in the transportation, warehousing and utility sector dropped by 66,000.

Nonfarm payrolls increased by only 33,000 jobs in February, the fewest since September 2017. The near-stall in job gains was partially blamed on colder weather and also viewed as payback after robust increases in December and January.

Job growth picked up in March, with the economy creating 196,000 positions, the government reported last Friday.

WORKERS STILL SCARCE

The drop in job openings in February likely does not change the theme of labor shortages in the economy. A survey of small businesses published on Tuesday found that just over a fifth of owners reported difficulties finding qualified workers as their “single most important business problem” in March.

According to the survey from the NFIB, 39 percent of small business owners reported job openings they could not fill in March. Thirty-three percent said they had openings for skilled workers and 14 percent have vacancies for unskilled labor.

Economists expect monthly job growth to average roughly 150,000 this year, stepping down from 223,000 in 2018.

“There are still millions of help wanted signs out there in the country so we hesitate to revise our outlook for the labor market overall,” said Chris Rupkey, chief economist at MUFG in New York.

The dive in job openings in February pushed down the vacancies rate to 4.5 percent from 4.8 percent in January. Hiring fell to 5.7 million in February from 5.8 million in the prior month. The decrease in hiring was led by the construction sector, where hiring fell by 73,000.

Hiring in the nondurable goods manufacturing industry dropped by 33,000 in February. Hiring by state and local government education departments fell 22,000.

The number of workers voluntarily quitting their jobs was little changed at 3.5 million in February, keeping the quits rate at 2.3 percent for a ninth straight month.

The quits rate is viewed by policymakers and economists as a measure of job market confidence. The worker reluctance to switch jobs is despite the tight labor market conditions that are steadily driving up wages.

“This is not as many quits as you would expect in such a tight labor market, when workers are in higher demand,” said Nick Bunker, an economist at Indeed Hiring Lab. “Though perhaps this isn’t surprising in the short term given that the ratio of unemployed workers to job openings has been rising.”

Layoffs increased in February, lifting the layoffs rate to 1.2 percent from 1.1 percent in January. There were increases in layoffs in the professional and businesses services, and healthcare and social assistance sectors in February.

(Reporting By Lucia Mutikani; Editing by Chizu Nomiyama and Andrea Ricci)

U.S. weekly jobless claims unexpectedly fall

FILE PHOTO: A man looks over employment opportunities at a jobs center in San Francisco, California, in this February 4, 2010 file photo. REUTERS/Robert Galbraith/Files

WASHINGTON (Reuters) – The number of Americans filing applications for unemployment benefits unexpectedly fell last week, suggesting labor market conditions remained solid, despite slowing job growth.

Initial claims for state unemployment benefits dropped 5,000 to a seasonally adjusted 211,000 for the week ended March 23, the Labor Department said on Thursday. Data for the prior week was revised to show 5,000 fewer applications received than previously reported.

Economists polled by Reuters had forecast claims rising to 225,000 in the latest week. The Labor Department said no states were estimated. The government revised the claims data and the so-called seasonal factors from 2014 through 2018. It also updated the seasonal factor for 2019.

The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 3,250 to 217,250 last week.

Job growth has slowed after last year’s robust gain. The pace, however, remains more than enough to keep up with growth in the working age population. The unemployment rate is currently at 3.8 percent. The moderation in job growth also reflecting a shortage of workers and softening economic growth as the stimulus from a $1.5 trillion tax cut package fades.

Thursday’s claims report showed the number of people receiving benefits after an initial week of aid rose 13,000 to 1.76 million for the week ended March 16. The four-week moving average of the so-called continuing claims fell 4,250 to 1.75 million.

The continuing claims data covered the survey week for March’s unemployment rate. The four-week average of continuing claims rose slightly between the February and March survey periods, suggesting little change in the unemployment rate.

(Reporting By Lucia Mutikani; Editing by Andrea Ricci)

U.S. private payrolls surge in December; weekly jobless claims rise

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. private payrolls increased by the most in nearly two years in December, suggesting sustained strength in the labor market despite ongoing financial market volatility.

While other data on Thursday showed the number of Americans filing applications for unemployment benefits increased more than expected last week, the underlying trend in claims remained low. Claims data tend to be volatile around year-end holidays.

Labor market data is being closely watched for signs of whether tightening financial conditions could be impacting on companies’ hiring decisions. A sharp stock market sell-off has stoked fears about the economy’s health.

The ADP National Employment Report showed private payrolls rose by 271,000 jobs last month after a downwardly revised 157,000 increase in November. Economists polled by Reuters had forecast private payrolls advancing 178,000 last month following a previously reported 179,000 increase in November.

The ADP report, which is jointly developed with Moody’s Analytics, was published ahead of the government’s more comprehensive employment report for December scheduled for release on Friday.

The ADP report has a spotty record predicting the private-payrolls component of the government’s employment report and last month’s jump probably exaggerates the strength of the labor market.

“The December ADP data have been especially unreliable because of the challenge of adjusting for ‘purging’ effects,” said Jim O’Sullivan, chief U.S. economist at High Frequency Economics in White Plains, New York.

“December is typically when employers drop from their listings all individuals who have left their firms permanently,” he said. “Such workers are dropped from the government data when they are no longer being paid, but some employers keep former employees on their lists for ADP until year-end tax documents have been filed.”

According to a Reuters survey of economists, nonfarm payrolls likely increased by 177,000 jobs last month after rising 155,000 in November. The unemployment rate is forecast steady near a 49-year low of 3.7 percent, not too far from the Federal Reserve’s forecast of 3.5 percent by the end of 2019.

With the labor market viewed at being at or beyond full employment, the pace of job growth is slowing as employers struggle to find workers. Some of the moderation in employment gains has been attributed to the stock market rout.

The Fed raised interest rates last month for the fourth time in 2018, but forecast fewer rate hikes this year and signaled its tightening cycle is nearing an end in the face of financial market volatility and slowing global growth.

U.S. financial markets were little moved by the data.

In a separate report on Thursday, the Labor Department said initial claims for state unemployment benefits rose 10,000 to a seasonally adjusted 231,000 for the week ended Dec. 29. Data for the prior week was revised higher to show 5,000 more applications received than previously reported.

Economists polled by Reuters had forecast claims increasing to 220,000 in the latest week.

The Labor Department said claims for California and Virginia were estimated last week. Unadjusted claims for both of those states declined last week.

A Labor Department official said there was no indication of an increase in filings last week from federal workers furloughed because of a partial shutdown of the government that is now in its second week.

Data on claims filed by federal employees is released with a one-week lag. The shutdown, which started on Dec. 22, was triggered by President Donald Trump’s demand for $5 billion in border wall funding.

Some 800,000 employees from the Departments of Homeland Security, Transportation, Commerce and others have been furloughed or are working without pay.

Claims data tends to be noisy around year-end holidays. The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, slipped 500 to 218,750 last week.

(Reporting By Lucia Mutikani; Editing by Andrea Ricci)

U.S. weekly jobless claims drop to near 49-year low

FILE PHOTO: People wait in line to attend TechFair LA, a technology job fair, in Los Angeles, California, U.S., January 26, 2017. REUTERS/Lucy Nicholson

WASHINGTON (Reuters) – The number of Americans filing applications for jobless benefits tumbled to near a 49-year low last week, which could ease concerns about a slowdown in the labor market and economy.

Initial claims for state unemployment benefits dropped 27,000 to a seasonally adjusted 206,000 for the week ended Dec. 8, the Labor Department said on Thursday. Last week’s decline in claims was the largest since April 2015. Claims hit 202,000 in mid-September, which was the lowest level since December 1969.

Data for the prior week were revised to show 2,000 more applications received than previously reported.

Economists polled by Reuters had forecast claims falling to 225,000 in the latest week. Claims shot up to an eight-month high of 235,000 during the week ended Nov. 24.

The Labor Department said only claims for Virginia were estimated last week.

The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 3,750 to 224,750 last week.

While difficulties adjusting the data around holidays likely boosted applications in prior weeks, there were concerns the labor market was losing some momentum given financial market volatility, the fading stimulus from a $1.5 trillion tax cut and the Trump administration’s protectionist trade policy.

Last week’s sharp drop in claims also suggests a slowdown in job growth in November was likely the result of worker shortages. Nonfarm payrolls increased by 155,000 jobs after surging by 237,000 in October.

With the unemployment rate near a 49-year low of 3.7 percent, Federal Reserve officials view the labor market as being at or beyond full employment.

The U.S. central bank is expected to raise interest rates at its Dec. 18-19 policy meeting. The Fed has hiked rates three times this year. Most economists expect the central bank will increase borrowing costs twice next year, although traders expect no more than one rate increase.

Thursday’s claims report also showed the number of people receiving benefits after an initial week of aid increased 25,000 to 1.67 million for the week ended Dec. 1.

The four-week moving average of the so-called continuing claims slipped 2,500 to 1.67 million.

(Reporting by Lucia Mutikani Editing by Paul Simao)

U.S. regains crown as most competitive economy for first time since 2008

FILE PHOTO: U.S. President Donald Trump gestures as he delivers a speech during the World Economic Forum (WEF) annual meeting in Davos, Switzerland January 26, 2018. REUTERS/Denis Balibouse/File Photo

By Katanga Johnson

WASHINGTON (Reuters) – The U.S. economy sits atop of the World Economic Forum’s annual global competitiveness survey for the first time since the 2007-2009 financial crisis, benefiting from a new ranking methodology this year, the Swiss body said on Tuesday.

In its closely-watched annual Global Competitiveness Report, the WEF said the U.S. is the country closest to the “frontier of competitiveness,” an indicator that ranks competitive productivity using a scale from zero to 100.

The U.S. beat off Singapore, Germany, Switzerland and Japan, the other top four markets, with a score of 85.6 out of 100, the report said, due to its “vibrant” entrepreneurial culture and “strong” labor market and financial system.

The World Economic Forum, the same organization that runs the Davos meeting of global powerbrokers each January, bases its rankings of 140 economies on a dozen drivers of competitiveness, including a country’s institutions and the policies that help drive productivity.

This year the WEF changed its methodology to better account for future readiness for competition, such as a country’s idea generation, entrepreneurial culture, and the number of businesses that disrupt existing markets.

The last time the U.S. topped the list was 2008.

The WEF said it was too early to factor in how the Trump administration’s recent trade policies would affect its ranking.

“While it is too early for the data to filter through in this year’s report, we would expect trade tensions with China and other trading partners to have a negative impact on the US’ competitiveness in the future, were they to continue,” Saadia Zahidi, the managing director at the World Economic Forum, said in an email.

“Open economies are more competitive.”

(Reporting by Katanga Johnson; Editing by Michelle Price)

U.S. labor market hot, jobs hard to fill: Fed’s Harker

FILE PHOTO: People wait in line to attend TechFair LA, a technology job fair, in Los Angeles, California, U.S., January 26, 2017. REUTERS/Lucy Nicholson - RC1458E83C90

(Reuters) – U.S. employers are struggling to fill jobs and that is unlikely to change any time soon given the labor market is getting quite tight, Federal Reserve Bank of Philadelphia President Patrick Harker said on Tuesday.

“We have a labor market with very little slack left, and the most common refrain I hear from employers is that they can’t fill the jobs they have,” Harker said in prepared remarks to a conference on higher education. “Those demographic and technological pressures are unlikely to recede.”

The unemployment rate fell to near a 49-year low of 3.7 percent last month.

(Reporting by Jonathan Spicer; Editing by Chizu Nomiyama)