US economy recovering but isn't yet accelerating

May 3, 2012 RSS Feed Print

On Thursday, big retailers including Costco, Macy's and Target, reported that sales last month came in below expectations.

— CORPORATE PROFITS

U.S. companies earned more money than analysts expected from January through March. They're beating Wall Street estimates at the best rate in more than a decade. Improved earnings have propelled the Dow Jones industrial average up nearly 4 percent since April 10.

U.S. corporations excluding banks and other financial firms are sitting on more than $2.2 trillion in cash, up from $1.7 trillion in 2009. That surplus means they can afford to expand and hire whenever they're confident enough.

— MANUFACTURING

Manufacturing has provided much of the fuel for the U.S. recovery since the recession ended roughly three years ago. American manufacturing expanded last month at the fastest pace in 10 months. New orders rose to the highest level in a year, a signal of more production in coming months. Export orders also rose, despite worries that weaker economies in Europe and China could hold back U.S. exports.

And the busier factories are hiring. Manufacturers added 120,000 jobs a month through March this year, their fastest three-month pace since 1997.

But the economists surveyed by the AP think manufacturers will fill jobs more slowly the rest of the year. If so, that could weaken overall job growth.