Trend watch and what's new this week
More big news in the fight against COVID-19. The Food and Drug Administration (FDA) authorized a vaccine for children ages 5 to 11 years. Also, a second treatment pill was highly effective in clinical trials and is heading toward FDA approval.
There’s been further improvement of U.S virus trends (slide 3). Still, the regional U.S. hotspots, particularly in colder states, haven’t improved (slide 7). Similarly, new cases for school-aged children ticked upward in the past week (slide 8).
This week, we updated the staffing data, which jumped to a new all-time high (slide 10). Companies have quickly added temporary staff as the delta variant receded.
There was big spike—more than 50% WoW—in new business formations (slide 11), which we believe is related to the end of federal pandemic unemployment programs roughly six weeks earlier.
Lastly, we updated the U.S. port traffic data (slide 12). There was some improvement in the past week for container ships.
Overall economic activity—based on traditional monthly data—continues to reaccelerate following the delta variant, including staffing, manufacturing gauges, and freight volumes. But typical seasonality is reducing travel activity, including air travel, hotel occupancy, and some of the restaurant data.
The biggest example was monthly job growth in October, up 531,000 and the unemployment rate slipped to 4.6%. Additionally, several manufacturing surveys rebounded during October.
On the inflation front, we’ve repeatedly highlighted the ongoing supply chain problems and transportation bottlenecks. Higher shipping costs, due to increased fuel prices, have also contributed. Those challenges hamper overall growth and will likely persist for some time.
More importantly, we’ve heard very little about weakening demand. On the contrary, most complaints have centered on “too much” demand for their capacity, constrained by supply chain bottlenecks, or insufficient labor, or both. Either way, that’s not a recipe for the stagnant growth many investors currently fear. In fact, we’re likely to see elevated growth extended for a few years.
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