Friday PM August 21st, 2009

Texas edges closer to national unemployment rate…First-time buyers tax credit spurs home sales…Two home buyer fairs set for Saturday…

The unemployment rate in Texas is on the brink of eight per cent, although the state added jobs in July for the first time since late last year. The Texas Workforce Commission said the jobless rate jumped to 7.9 per cent from 7.5 per cent in June. However, the number of jobs rose by 37,900, the first increase since November when Texas was bouncing back from Hurricane Ike. Texas continues to creep closer to the national unemployment rate, which is at 9.4 per cent. The state was a full two percentage points under the national figure a month ago. Professional and business services jumped by 18,700 jobs last month. Education and health services increased by 14,400.

The unemployment rate fell in 17 states and the District of Columbia last month, a positive sign even as the pain of joblessness remains widespread. The Labor Department says the jobless rate fell in July in Texas, as well as in New York, Minnesota and Virginia, among other states. It increased in 26 states. Only five states registered declines in June, when the rate rose in 38 states. The department also says 21 states added jobs in July, compared with only ten in the previous month. Still, 15 states and the District of Columbia have jobless rates above ten per cent. Nationwide, the unemployment rate fell to 9.4 per cent in July from 9.5 per cent in June.

Home re-sales posted the largest monthly increase in at least ten years last month as first-time buyers rushed to take advantage of a tax credit that expires this fall. The National Association of Realtors says home sales rose 7.2 per cent to a seasonally adjusted annual rate of 5.24 million last month, from a pace of 4.89 million in June. It was the fourth-straight monthly increase and the highest level of sales since August 2007. Sales had been expected to rise to an annual pace of five million, according to economists surveyed by Thomson Reuters. The median sales price was $178,400, down 15 per cent from $210,100 in the same month last year.

Houston retail gasoline prices dropped two cents to $2.48 per gallon, according to AAA. Statewide and nationwide, motorists are seeing about a three-cent decline.

Houston hotels can expect a higher demand for rooms beginning in the second quarter of 2010, according to PKF Hospitality Research. But a growing supply of hotel rooms could drive annual average occupancy down to 58.3 per cent from 59.2 per cent.

Federal Reserve Chairman Ben Bernanke says the U.S. economy is on the verge of a long-awaited recovery after enduring a brutal recession and the worst financial crisis since the Great Depression. In a speech at an annual fed conference in Jackson Hole, Wyoming, Bernanke says economic activity in both the U.S. and around the world appears to be “leveling out,” and “the prospects for a return to growth in the near term appear good.” The more upbeat assessment was consistent with the Fed’s observations earlier this month as it took a small step toward pulling back some emergency programs to revive the economy.

The recession is causing Americans to cut back on discretionary spending, as well as lifestyle choices, according to a Zogby Interactive survey. Activities most impacted include driving, eating at restaurants, going to movies and traveling. Other choices include bringing lunch to work, selling belongings, downsizing home and taking in boarders. Cost-cutting is prevalent across demographic groups, including income.

A survey by ING Direct says only about half of American adults, or 54 per cent, plan to spend $300 or more on Christmas gifts this year. That’s about ten per cent decrease from what Americans said they were going to spend last year. Older Americans appear to be pulling back the most, especially in the northeast. Four out of ten, or 41 per cent, say their top priorities will be to save money and spend less the remainder of the year.

As car shoppers head into the final weekend of the cash for clunkers program, a couple of car companies are offering cash advances for dealers. The Obama administration has announced the popular promotion will end Monday night after burning through about $3 billion in just a month. The rebate money has been fronted by dealers, and many of them have complained of slow reimbursements from the government. Now, both Chrysler and General Motors say they will start making cash advances to help dealers with their cash flow. The automakers are offering the advances for up to 30 days. They say the extra money will be available as long as the program remains in effect.

Shoppers wanting deals are heading to stores for the Texas sales tax-free weekend before most public schools open Monday. Some stores advertised plans to open early and close later than normal through Sunday. The Texas Comptroller’s Office says the law exempts most clothing and footwear priced under $100 from sales and use taxes. The agency says backpacks under $100 and used by elementary and secondary students are also exempt. The 2009 legislature expanded the list of items qualifying for the sales tax exemption to include most school supplies priced at less than $100. The supplies, in order to quality, must be purchased for use by a student in an elementary or secondary school. Tax-free items range from jeans to jerseys to jogging apparel.

Southwest Airlines is on its way to providing in-flight wi-fi access on all of its aircraft. The airlines and Internet wi-fi service provider Row 44 have plans to roll out the program in the first quarter of 2010. Southwest has been testing the service on four aircraft since February 2009. Customers have been using the service for many applications during the testing phase, including e-mail and streaming video. Southwest has tested a variety of price points for the service and will continue testing price points through the end of 2009. Fort Worth-based American Airlines and Atlanta-based Delta Airlines already offer onboard wi-fi service on some of its aircraft, and Tempe, Arizona-based US Airways says it’ll begin offering service next year.

Two home buyer fairs are set for Saturday. One is at the Southwest Multi-Service Center on Highstar, beginning at nine tomorrow morning, sponsored by the Alliance for Multicultural Community Services. Another is also set for nine at the Sheraton Brookhollow Hotel on North Loop West, sponsored by Avenue Community Development Corporation and the City of Houston and Catholic Charities.

Finding movie listings in the newspaper could become a thing of the past. The top two U.S. chains, Regal Entertainment Group and AMC Entertainment, have started reducing or eliminating listings showing the start times for movies. Theaters typically pay newspapers to print that information. To cut costs, the theater chains are instead directing consumers to their Internet sites or third-party sites, like Fandango, Moviefone or Flixster, which offer those listings for free. Those sites make money from the fees they charge for selling advance tickets to movies. Many of those sites also feature film reviews and movie trailers. AMC helped shine a spotlight on the trend last month when it pulled its listings from the Washington Post.

The number of rigs actively exploring for oil and natural gas in the United States rose by 17 this week to 985. Houston-based Baker Hughes reported that of the rigs running nationwide, 695 were exploring for natural gas and 280 for oil. Ten were listed as miscellaneous. A year ago, when oil and gas prices were much higher, the rig count stood at 1,998. Texas added 17 rigs. The rig count tally peaked at 4,530 in 1981, during the height of the oil boom. The industry posted a record low of 488 in 1999.

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