Evidence may be growing that the economy is on the rebound. But that isn’t stopping companies large and small from shedding jobs.
Growth – however slight – in retail sales, and lower first-time jobless claims has dovetailed with rising stock prices the past few months giving many Americans a sense that the state of the economy is brightening.
That’s underscored in a new poll out today showing consumer confidence rising to a nine-month high in June.
But before anyone gets too excited, a dose of reality. Some companies are still adjusting to new economic realities.
Aircraft maker Cessna announced this morning that it plans to shed 1,300 more jobs this month. Orthopedics manufacturer Zimmer Holdings Inc. is laying off more than 100 employees at its northern Indiana plant. And Carlson Craft, a wholesale printing company in southern Minnesota, says it's eliminating 114 positions in an “effort to adapt to the current economic downturn.”
State budgets are also reeling under economic stress. In Iowa, the state’s three public universities could be forced to layoff up to 250 people as they deal with less money from the state.
Hawaii's already faltering economy is expected to worsen in coming months as the impact of the steep decline in Japanese tourists is felt and Gov. Linda Lingle's plan to furlough as many as 46,500 state employees takes hold.
Experts say the dueling data underscores how difficult it is to predict just when the economy will regain its footing. Some economists predict that the American economy could resume growth as early as the fourth quarter. Others say rising unemployment, coupled with a still staggering real estate market, will push any recovery back months.
The number of Americans filing for unemployment benefits fell last week by 24,000. Yet the total number of people now collecting unemployment benefits rose by 59,000 to more than 6.8 million, the highest since 1967, government statistics show.
Liz Ann Sonders, chief investment strategist at Charles Schwab, said on "Good Morning America" recently that despite mixed signals the economy is set to revcover sooner rather than later.
"It isn't any brilliant prescience on mine or anybody else's part," Sonders said. "There's certain indicators we can look at to set the turn, and I think we have seen that turn."