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Good morning! Today we look at how companies are trying to expand the pool of potential workers, more fallout from tariffs, China’s shrinking trade deficit, and the economy’s strength and sustainability.
NO EXPERIENCE? NO DEGREE? NO PROBLEM!
Employers are slowly abandoning preferences for college degrees and specific skill sets to speed up hiring and broaden the pool of job candidates. Only 23% of entry-level jobs now ask applicants for three or more years of experience, compared with 29% back in 2012, putting an additional 1.2 million jobs in closer reach of more applicants, Kelsey Gee reports.
What’s happening? Many companies added requirements to job postings after the recession, when millions were out of work and human-resources departments were stacked with résumés. Now, the tightest job market in decades has left employers with only a handful of options: Offer more money, lower their standards or retrain current staff in coding, procurement or other necessary skills.
Next up: The Labor Department’s July employment report is out Friday.
Do you think companies are casting a wider net for workers? Tell us about your experience. Write to Jeffrey Sparshott at realtimeeconomics@wsj.com, tweet to @WSJecon and visit wsj.com/economy for the latest news. (Please include your full name and hometown, or a title and company. Responses may be quoted in this newsletter.)
WHAT TO WATCH TODAY
Germany’s consumer-price index for July is due out at 8 a.m. ET.
U.S. pending home sales for June, out at 10 a.m. ET, are expected to hold steady from the prior month.
The Dallas Fed manufacturing survey for July is out at 10:30 a.m. ET.
President Trump meets with Italian Prime Minister Giuseppe Conte, culminating in a 2 p.m. ET joint press conference. Italy’s new coalition government is skeptical of free trade, globalization, multilateralism and the EU.
China’s manufacturing purchasing managers’ index for July is out at 9 p.m. ET.
TOP STORIES
TOUGH SLEDDING
Consumers are starting to see higher prices for recreational vehicles, soda, beer and other goods that now cost more to make as a result of recent tariffs on metals and parts. When costs rise, manufacturers choose whether to absorb bigger bills or pass the increases along to customers. Many manufacturers in recent days, including Coca-Cola and Polaris Industries, have said they plan to raise prices, Patrick McGroarty and Bob Tita report.
For example: Polaris is raising prices on its boats, motorcycles, snowmobiles and other recreational vehicles to cover $15 million of the $40 million in tariff-related costs. Chief Executive Scott Wine said the company would accelerate plans to move production of motorcycles that it sells in Europe to Poland from Iowa to avoid rising European Union tariffs.
SOMETIMES I FEEL LIKE A NUT
U.S. almond farmers are getting crunched. Prices for California almonds have fallen by more than 10% over the past two months, reflecting expectations for a bumper crop and steep tariffs imposed this year by China, which until recently was the second-largest importer of U.S. almonds after the European Union. China now adds a 50% tax to almonds, has quietly closed trading loopholes and is also cracking down on commodities that have been illegally smuggled into the country, Lucy Craymer reports.
CLOSING THE GAP
For years, China has sold much more to the world than it has bought. Now, that imbalance is shrinking, helping Chinese leadership argue it no longer pursues a mercantilist policy. Official data is expected to show China’s current account, which measures its transactions with the rest of the world, was in deficit for the six months ending in June, Lingling Wei reports. That essentially means it imported more than it exported. The trend, at least for now, is unlikely to impress President Trump, who focuses on the U.S.’s ever-widening trade deficit with China. And some economists argue China is hardly rebalancing. The country’s status as the world’s factory floor—meaning it purchases raw materials and components from overseas and then assembles and ships the final products out—remains little changed, they say.
BOOM GOES THE ECONOMY
U.S. gross domestic product advanced at a 4.1% annualized rate in the second quarter. That’s unlikely to be repeated, though the underlying picture looks impressive, Greg Ip writes. To get a clear view of the second quarter, exclude the volatile categories of net exports, which were boosted by soybean shipments ahead of tariffs, inventories and government. The result: 4.3% growth, even faster than the headline rate. Over the past year, it’s up 3.2%, a decent proxy for underlying growth.
Will it last? The numbers suggest the expansion has room to run. But sustained growth at that pace requires both faster growth in the pool of workers and in their productivity. Macroeconomic Advisers see still-solid 3.1% growth in the current quarter, though longer term Federal Reserve and Congressional forecasters expect the economy to settle back to something in the 1.8% to 1.9% range.
MIRACLE ON 4.1 STREET
President Donald Trump touted the “American economic miracle” after Friday’s gross domestic product report. The WSJ’s Eric Morath analyzed Commerce Department data to track Mr. Trump’s incomplete term against the full tenures of other recent presidents. Here’s how he stacks up so far:
TWEET OF THE DAY
[wsj-responsive-sandbox id = "0" ]WHAT ELSE WE’RE READING
The U.K.’s unemployment rate is at its lowest level since 1975 but wages remain stuck. The reason? “Elevated levels of underemployment suggest the UK economy is nowhere close to full-employment in the summer of 2018,” David Bell and David Blanchflower write in a National Bureau of Economic Research working paper. The result for workers is bleak: “We find evidence of a large rise in anxiety and depression among the underemployed and especially so for underemployed women. The underemployed don’t want to be underemployed.”
Through work men grow rich in flocks and substance – Hesiod. A new study looking at pollen data in ancient Greece helps detail development of a market economy before the Roman conquest and a shift toward global markets after. “[I]ncreasing urbanization—in the 6th century BCE and onward—seems to have stimulated the production of cash crops and agricultural specialization in different parts of the Greek mainland,” Uppsala University’s Anton Bonnier, Jagiellonian University’s Adam Izdebski, Brandeis University’s Tymon Sloczynski, the Warsaw School of Economics’s Grzegorz Koloch and the National and Kapodistrian University of Athens’s Katerina Kouli write.
UP NEXT: TUESDAY
The Bank of Japan releases its policy statement and quarterly outlook report.
German employment for July is out at 3:55 a.m. ET.
The eurozone consumer-price index for July is out at 5 a.m. ET.
Eurozone GDP for the second quarter is out at 5 a.m. ET.
The U.S. personal income and outlays report for June is out at 8:30 a.m. ET. The data include a look at the Fed’s preferred inflation measure, the personal consumption expenditure price index.
The U.S. employment cost index for the second quarter is out at 8:30 a.m. ET.
The S&P/Case-Shiller home price index for May is out at 9 a.m. ET.
The Conference Board’s consumer confidence index for July is out at 10 a.m. ET.
The Federal Reserve starts a two-day policy meeting.
from Real Time Economics https://ift.tt/2mTv8TT
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