WASHINGTON: High-frequency measures of the US economy may be showing the first signs of an expected spring revival, with employment at small and medium-sized businesses rising slightly, and traffic to retail stores improving from the levels of last fall when the coronavirus surged.
The challenges facing the US economy remain mountainous. Nearly 800,000 people filed for unemployment insurance in the week ended Feb 6, and as of late January more than 20 million were collecting some form of unemployment benefit - 10 times the typical level.
Overall job growth has been sluggish since the fall, barely nipping at the 9 million job hole left by the pandemic, and data from online reservations firm OpenTable and the US Transportation Security Administration show little improvement in the hard-hit restaurant or travel industries.
But analysts have become more confident that as the weather warms and vaccinations become more widespread, the economy will thaw also, and some data already points at least tentatively in that direction.
January was "a transition month for economic data," as the vaccine rollout began, some states started easing restrictions on commerce, and some federal benefit payments resumed following congressional action in late December, wrote Jeffries economists Aneta Markowska and Thomas Simons. "By February, we expect a broad-based improvement in growth momentum."
Foot traffic to retail stores fell after a holiday surge, according to cellphone data gathered by Unacast, but resettled at levels above last fall when a new pandemic wave pushed the number of daily infections well above 200,000. The number of daily new infections has fallen by half since then.
The number of employees working at a sample of small businesses has risen slowly for five consecutive weeks, according to data from time management firm Homebase.
An index of shift work at a broader set of industries rose in early February to its highest level since November after falling in December and January, according to data from time management firm UKG.
Shift volume rose 1.2 per cent from early January to early February, and significantly the increase was about the same at companies with fewer than 500 people as it was for the larger firms that had dominated any recent improvement in labour use, said UKG vice president David Gilbertson.
There are "tentative signs of labour recovery" heading into February, he said, as well as "some positive tailwinds - such as increasing vaccinations, loosening restrictions, and warmer weather” ahead.
Indexes of current and new job openings from hiring site Indeed and analytics firm Chmura have both increased since the start of the year.
An Oxford Economics broad index of the recovery rose for a fourth consecutive week, the first month-long improvement since the summer. The firm now expects 2021 US economic growth to near 6 per cent given the expected addition of more government spending. That is up 1.7 percentage points from January's forecast.
"Green shoots" started appearing in January as the health metrics improved, chief US economist Gregory Daco wrote recently, and should take root as vaccinations proceed.
"The state is set for a spring revival."