Focus

In this issue, we share what roofing contractors expect from the economy in 2004, as well as how the construction sector should perform (see "Is it time to loosen your belt?"). Overall, things are looking better—the economy is slowly picking up, and construction starts continue to rise.

But there is one aspect of the economy that continues to trouble economists because it likely will affect how quickly the economy completely rebounds. Job creation is thumbing its nose at everyone else's hopes for a better year.

According to BusinessWeek magazine, the economy gained 57,000 jobs in September but lost jobs in the third quarter overall.

BusinessWeek's report states: "The third quarter was a spectacular anomaly—the only time in at least 40 years in which the economy actually shed jobs while growing at a rate of 5.5 percent or better. In September, 9 million people were jobless. Nearly a quarter had been out of work for at least half a year."

Alarmingly, there isn't a great deal U.S. businesses can do to relieve the jobless rate. Sectors that took the biggest hit during the recession—manufacturing, technology and automobiles, for example—are showing only modest gains in revenue. And the gains aren't big enough that companies are willing to bank a large amount of new jobs on them. To make things worse, BusinessWeek says that if the economy had acted as it historically has coming out of recessions, nearly 1 million nonfarming jobs should have been created by now. Instead, the nation is at a loss of 150,000 such jobs for its second-quarter average.

For the construction industry, the job situation is better than other sectors. According to the U.S. Bureau of Labor Statistics, since September, the sector has seen a 1 percent increase in jobs—about 51,000 jobs. But that is offset by staggering losses in sectors such as manufacturing, which saw an 8 percent drop in jobs since September—about 1.3 million. Economists are working under the assumption that the job market will stabilize and the economy will continue to see growth—even if it is at a slower pace than expected.

As BusinessWeek explains: "More than ever before, employment growth comes from the creation of brand-new jobs. ... Employment won't really go gangbusters until innovation spawns new industries."

Ambika Puniani is editor of Professional Roofing magazine and NRCA's director of communications.