Goldman Sachs CEO details hiring plans in Salt Lake City

NEW YORK – Goldman Sachs Group Inc. plans to add 300 workers to its fast-growing office in Salt Lake City, Utah, by the end of the year, Chief Executive Lloyd Blankfein told employees at a town hall meeting there on Tuesday, according to a Goldman staffer who was present.

The increase would bring Goldman’s workforce in the city to 1,600, the attendee cited Blankfein as saying. The person spoke on condition of anonymity because he was not authorized to speak to the press.

Blankfein, 57, was in Salt Lake City to meet with Mayor Ralph Becker and Utah Governor Gary Herbert, and also to make his first visit to Goldman’s downtown office.

Goldman spokesman David Wells confirmed Blankfein’s visit but could not immediately verify the figures.

Goldman first opened a Utah office in 2000, but has been expanding there rapidly since entering a tax break deal with the state in 2009.

Goldman will receive an estimated $47.3 million from Utah over a 20-year period in the form of a 30 percent tax rebate, according to Governor’s Office of Economic Development.

In exchange, the bank agreed to maintain at least 1,065 employees in Salt Lake City and pay them at least 150 percent of the average local county salary.

Bernanke at public forum: Fed focused ‘intently’ on job creation

FORT BLISS, Texas ― Spurring stronger growth and more robust job creation in the weak recovery are top priorities for the Federal Reserve, Chairman Ben Bernanke told a military audience at a rare public forum on Thursday.

“For a lot of people, I know, it doesn’t feel like the recession ever ended,” Bernanke said in remarks before a town hall-style meeting at which he fielded questions from an audience of 175 military personnel and family members.

Two of the Fed’s harshest critics are Texans and Republican candidates for president — Governor Rick Perry and Representative Ron Paul. Bernanke, who met troops returning from Iraq at 2:45 in the morning, used the setting to defend the central bank’s aggressive policies to promote growth and rebut charges it was recklessly spending government money.

Bernanke said the 9 percent jobless rate and record numbers of long-term unemployed Americans are serious problems preoccupying policymakers.

“We at the Federal Reserve have been focusing intently on supporting job creation. Supporting job creation is half of our marching orders, so to speak,” he said.

The Fed’s other job is to keep inflation in check. Bernanke said inflation should moderate and remain close to the Fed’s preferred level of 2 percent or a bit less for the foreseeable future.

Bernanke defended aggressive Fed policies against critics who charge the U.S. central bank has recklessly printed money without regard for the dangers of inflation or a weaker dollar.

“It is important to understand that this type of activity isn’t the same as government spending,” he said.

Public appearances by a Fed chairman are rare. Bernanke’s second-ever town-hall meeting — the last was in July 2009 — likely reflects a desire to counter critics from both political parties.

At Fort Bliss, most members of the audience were dressed in olive camouflage fatigues. Bernanke’s remarks were punctuated on occasion by the fussing and chattering of young children.

Republicans have focused on attacking the Fed’s extensive easy money policies, saying the central bank has failed to revive the economy despite cutting interest rates to near zero and buying $2.3 trillion in bonds. Some have warned the Fed against taking actions best left to fiscal policymakers.

Perry has equated the Fed’s bond buying with treason and suggested Texans might “treat him pretty ugly” if he ever went to the Lone Star State. Paul, a long-time advocate of returning to pegging the value of the dollar to gold or silver, wants to abolish the Fed.

Democrats have charged that the Fed has implemented policies benefiting Wall Street while disregarding the economic struggles of ordinary Americans. Some argue Fed policymakers should be subject to greater accountability.

Obama jobs plan reinvigorates growth outlook, analysis shows

WASHINGTON ― President Barack Obama’s jobs package could lift economic growth by one to three percentage points in 2012, add well over 1 million jobs and lower the unemployment rate by at least half a percentage point, judging by early estimates.

It might not exactly deliver the “jolt” Obama claimed in his speech to Congress Thursday night, but it would be enough to make a difference.

The basic idea is to give a sufficient boost to get the stalled recovery over the hump where households, banks and businesses have paid down more of their debt loads and regained the confidence to start spending, lending and hiring again.

Once demand picks up, the private sector will kick in and begin hiring, and the fiscal props can fall away.

It would deliver the economic medicine prescribed in recent weeks by Federal Reserve Chairman Ben Bernanke and the International Monetary Fund to prevent a worrisome slowdown in global economic growth from turning into recession.

Treasury Secretary Timothy Geithner also can assure his fellow finance officials at the G7 meeting of top industrial nations in Marseilles on Friday the United States is pulling its weight.

The wild card of course is whether a Republican-dominated House of Representatives will agree to the full $447 billion package, an unlikely prospect given their criticism that the $830 billion stimulus program of February 2009 failed to deliver lift-off for the economy and added to the huge budget deficit.

The U.S. economy is so scarred by the 2007 housing credit implosion, the bank failures it triggered in 2008 and the deepest recession in 70 years that it is taking a very long time to recover and create jobs.

“What you come down to is that there is no silver bullet, no magic bullet that this president or anyone can propose that would drive unemployment down to 5 percent in the next year,” said Joel Prakken, chairman of Macroeconomic Advisers, an economic modeling firm in St. Louis.

“It has to come from the private sector and for that you have to work through the overhang from the housing crisis that is suppressing aggregate demand,” he said.

This suggests that Obama’s jobs program most likely would serve as a palliative, not a cure, leaving room for the Federal Reserve to provide further monetary stimulus to keep the economy from slipping back into recession.

Analysts at Capital Economics estimated that Obama’s plan is equivalent to 3 percent of U.S. GDP and should be enough to add significantly to 2012 growth if passed in full by Congress.

The biggest single boost could come from a $250 billion reduction in payroll taxes. Obama proposes extending an existing 2 percent cut in the payroll tax and increasing its size to 3.1 percent for workers, and adding a cut for employers.

“These payroll tax reductions are the proposals that have the greatest chance of getting passed by Congress because it will be harder for Republicans to vote against proposed tax cuts,” said Paul Ashworth, chief U.S. economist for Capital Economics.

The tax cuts could add as much as $375 billion to economic output to the $14 trillion U.S. economy, based upon Congressional Budget Office estimates in August of the economic impact that fiscal stimulus programs can have on GDP.

But not all of that would be fresh stimulus money, since a $112 billion payroll tax cut is already in place and would simply be extended. Additionally, the full impact would be lessened because it does not target lower income workers.

“It gives money disproportionately to people at the top of the income scale. Higher income individuals are more likely to save the money, they don’t need to spend it on essentials, so the effective impact is lessened,” said Roberton Williams, senior fellow at the centrist Urban-Brookings Tax Policy Center.

Still Macroeconomic Advisers estimated that the 2 percent payroll tax cut extension alone would add 400,000 jobs and boost GDP in 2012 by 0.5 percent. The larger sum might increase that to roughly 0.7 percent GDP and 600,000 jobs.

The second biggest element in Obama’s plan is the $105 billion in infrastructure investment, which could add as much as $262 billion to the economy, based on the CBO figures.

Macroeconomic Advisers estimates that could create about 150,000 new jobs in the first year and add over half a million jobs over three years — good news but small for an economy that usually generates over two million jobs a year when in good health.

The challenge also would be to find “shovel-ready” projects where highways, railroads or school renovation plans are on the drawing board awaiting funding. Otherwise it can take years to get major construction projects under way.

Extending unemployment benefits, which total $49 billion in Obama’s plan, also has a significant impact. It could add up to $102 billion to the economy. Macroeconomic Advisers estimates it would add 0.25 percent to GDP growth in 2012 and create 200,000 new jobs by putting extra cash in consumers’ pockets.

Economists were re-running computer models late on Thursday to update their figures. Based on a smaller $300 billion stimulus package that Obama unveiled, Ian Shepherdson, U.S. economist at High Frequency Economics, had estimated a 1.3 percent boost to GDP and 1.7 million jobs over the life of the programs.

Their initial reaction was if it were adopted in full, which is quite unlikely, the plan would lower the 9.1 percent unemployment rate closer to 8 percent in 2012 and give a welcome boost to an economy that grew at a 1 percent annual rate in the second quarter. But it is does not guarantee solid recovery.

“Is this going to be more than a panacea for our problems? It is hard to tell,” said Williams. “This downturn has been deeper and longer than anything we have seen since the 1930s and we don’t fully understand it. What we do know is that what we did in 2009 was not big enough.”

Labor Department reports job openings up in July but hiring slips

WASHINGTON ― The number of jobs waiting to be filled edged up slightly in July but hiring dipped, preventing a much-needed boost to the struggling economic recovery, government data showed Wednesday.

There were about 3.23 million available jobs at the end of July, a small increase from June’s 3.17 million, according to the Labor Department’s Job Openings and Labor Turnover Survey.

The rate at which workers were separated from jobs by layoffs or quits, a measure of labor turnover, was unchanged. But hires fell from 4.06 million in June to 3.98 million in July, indicating employers were not filling open jobs quickly enough to bring down the U.S. unemployment rate.

President Barack Obama has been counting on the economic recovery to help his reelection campaign. The still-high unemployment rate, 9.1 percent in July, as well as a disappointing payrolls reading that showed the economy added only 85,000 jobs during the month, put that at risk.

August payrolls numbers were worse, with the economy adding no net jobs during the month.

Obama will make a highly anticipated jobs speech Thursday to detail his plan for reviving the economy.

Monthly job openings — unfilled, posted vacancies that employers plan to fill within 30 days — help describe demand for labor. The number has consistently hovered well below the 4.4 million openings in December 2007, before the economic recession, according to the Labor Department.

The report showed the rate at which people quit their jobs, which can indicate workers’ confidence in their ability to find new jobs, was unchanged in July.

The rate of layoffs also was little changed.

The Job Openings and Labor Turnover Survey encompasses employment data from about 16,000 establishments across the country.

Service sector picks up steam in August, jobs still a worry

NEW YORK ― The dominant services sector picked up steam unexpectedly last month, snapping a three-month streak of slower growth, though the pace of hiring slowed slightly, underscoring broader job market concerns.

But the surprise increase in the index from the Institute for Supply Management was cause for encouragement, analysts said, suggesting consumers were holding up better than some had thought in what appears to be stalling U.S. economy.

Last week, government data showed U.S. employers did not add any new jobs in August, leaving the jobless rate at or above 9 percent for a fifth consecutive month.

The ISM index rose to 53.3 in August, from a 17-month low of 52.7 in July. Economists polled by Reuters had expected 51.0. A reading above 50 indicates expansion.

“The unexpected rebound will help to ease recession fears following last week’s news that payroll employment stagnated,” said Paul Ashworth, chief U.S. economist at Capital Economics in Toronto.

But he said the index at that level “is consistent with only muted economic growth of about 1.5 percent.”

And while new orders rose, suggesting continued demand, the employment index slipped to 51.6 in August, its lowest since September 2010, underscoring the difficulty facing the roughly 14 million Americans out of work.

It will be against this backdrop that President Barack Obama will detail new plans to spur job growth in a national speech on Thursday.

“Jobs growth is far below the level needed to bring the unemployment rate lower on a sustained basis,” said Michael Woolfolk, currency strategist at BNY Mellon in New York.

The poor U.S. jobs outlook, along with a festering debt crisis in Europe, helped spark a stock market sell-off last month that has battered business and consumer confidence.

The report was also at odds with service sector readings beyond U.S. borders, which showed on Monday that growth had slowed sharply last month in the euro zone, Britain and China.

Ian Shepherdson, chief U.S. economist at High Frequency Economics in Valhalla, New York, called the ISM report “a pleasant surprise after a run of mostly horrible numbers.”

“The bad news is that it probably does not tell us much about the future path of the economy, because the headline index is little more than a lagging indicator of the rate of growth of core retail sales, which have held up well in recent months.”

Better services growth may relieve pressure on the Federal Reserve to embrace new stimulus measures, analysts said.

“At the margin, it’s an argument against any further accommodation at this point, but this doesn’t necessarily countervail the whole bulk of the other data,” said Bill Jordan, economist at Ried Thunberg, a unit of ICAP.

The Fed will meet September 20-21 and Wall Street is betting officials will opt to buy more long-dated Treasuries to hold down long-term interest rates.

The central bank has already poured more than $2 trillion in to the financial system to boost lending and has said it could hold benchmark interest rates at record lows near zero until at least 2013.

Private sector adds 91,000 jobs in August, ADP report says

NEW YORK ― The pace of U.S. private sector job growth slowed in August for the second month in a row with employers adding 91,000 positions, a report by a payrolls processor showed on Wednesday.

Economists surveyed by Reuters had forecast the ADP National Employment Report would show a gain of 100,000 jobs. July’s private payrolls were revised down to an increase of 109,000 from the previously reported 114,000.

August’s gain was the smallest number of private jobs added since May’s disappointingly small reading of 35,000.

The ADP figures come ahead of the U.S. government’s much more comprehensive labor market report on Friday, which includes both public and private sector employment.

Economists often refer to the ADP report to fine-tune their expectations for the payrolls numbers, though it can be erratic in predicting the outcome.

“I don’t think this was a bad number, and I don’t think it changes people’s forecasts for Friday’s employment number. A small miss is not the end of the world, and we all know ADP can be unreliable, though it’s been better lately,” said Steven Butler, director of FX trading at Scotia Capital in Toronto.

The jobs report at the end of the week is expected to show a rise in overall nonfarm payrolls of 75,000 in August, based on a Reuters poll of analysts, and a rise in private payrolls of 105,000.

Government payrolls are expected to shrink for the ninth month in a row, but the decline may not be as steep as in the past three months since 23,000 state workers in Minnesota returned to the job after a partial government shutdown.

A strike by about 45,000 Verizon Communications Inc employees is also expected to put a dent in Friday’s numbers. Neither factor affects the ADP report and Macroeconomic Advisers LLC Chairman Joel Prakken said that could cause nonfarm payrolls to be a good deal weaker than indicated by Wednesday’s data.

While fears the economy is falling back into recession have increased this month, some of the recent data has been consistent with a slow-growth scenario rather than a contraction.

Slower than expected economic growth has fueled speculation the Federal Reserve could launch another round of bond buying — known as quantitative easing — but such a move would likely face political opposition both domestically and abroad.Markets saw little impact from the data. Wall Street opened higher open as comments from Fed officials boosted hopes of more monetary stimulus.

A separate report earlier on Wednesday showed the number of planned layoffs at U.S. firms declined in August after rising for three months in a row, but the cuts were still up sharply from a year ago amid government job losses.

Employers announced 51,114 planned job cuts, down 23 percent from 66,414 in July, according to the report from consultants Challenger, Gray & Christmas, Inc. July’s figure had been a 16-month high.

But August’s job cuts jumped compared to a year ago, rising 47 percent from 34,768. Cuts at the federal government level led the way and more are expected to come with the United States under pressure to cut federal budgets, the report said.

Private sector adds 157,000 jobs in June; more than expected

NEW YORK ― U.S. private employers added far more jobs than expected in June, bouncing back from a surprise slump the month before, a report by payrolls processor ADP showed Thursday.

The private sector added 157,000 jobs last month, exceeding expectations for a gain of 68,000, according to a Reuters survey of economists.

May’s figure was revised down to an increase of 36,000 from the previously reported 38,000, which had been an eight-month low.

The ADP report is jointly developed with Macroeconomic Advisers LLC.

The figures come ahead of the government’s much more comprehensive labor market report on Friday, which includes both public and private sector employment.

“The ADP results certainly put a bit of an optimistic spin on Friday’s payroll survey,” said Guy Lebas, chief fixed income strategist at Janney Montgomery Scott in Philadelphia.

U.S. stock index futures added to gains following the report, while the dollar gained more ground against the yen.

Friday’s report is expected to show a modest rise in overall nonfarm payrolls of 90,000 for last month and a gain in private payrolls of 110,000.

On Wednesday, a stable employment reading from the Institute for Supply Management’s service sector survey suggested employment growth later in the year.

Economists often refer to the ADP report to fine-tune their expectations for the payrolls numbers, though it is not always accurate in predicting the outcome.

Lockheed Martin to slash 1,200 jobs in space systems unit

BETHESDA, Md. – Lockheed Martin is cutting nearly 8 percent of jobs in its space systems unit, a move that will improve efficiencies but affect workers in California and Pennsylvania.

The company on Tuesday said about 1,200 employees would be removed in a combination of voluntary and involuntary layoffs. Most of the workers belong to middle management, which will be reduced by 25 percent.

The defense contractor’s space systems unit employs 16,000 workers in a dozen states to develop and manufacture technology ranging from ballistic missiles and missile defense shields, to human space flight systems, space observatories and interplanetary spacecraft.

Lockheed is working to remain competitive following a decline in commercial and public sector orders, combined with the recession and increased competitive activity.

Orders for space satellites are down. In addition, the U.S. Congress has decided to end the government’s use of F-22 Raptors in favor of the F-35, which military officials say is a more nimble and versatile fighter jet.

Apart from the layoffs in facilities in Sunnyvale, Calif., and Delaware Valley, Pa., the workforce reduction will affect the company’s plant in Denver. The cuts will be completed by the end of the year.

“In today’s economic environment, we have two choices: make painful decisions now or pay a greater price down the road. This is a difficult but necessary action to improve efficiencies and make our business more competitive going forward,” Joanne Maguire, executive vice president for the space systems unit, said in a statement.

“We will remain relentlessly focused on achieving operational excellence and mission success for our customers as we position to deliver more affordably in the future,” she added.

Apple’s Steve Jobs makes big push into an everyday cloud

SAN FRANCISCO ― Apple Inc. CEO Steve Jobs has unveiled services for people to store more of their photos, music and other data online, giving the iPad and iPhone maker the lead in a fast-expanding new consumer market.

Jobs entered to a standing ovation from more than 5,000 Apple faithful at its Worldwide Developers’ Conference Monday and showed off Apple products meant to help customers keep their iPhones, iPads and computers in sync.

The Silicon Valley icon and pancreatic cancer survivor ― animated but again looking very thin ― unveiled remote computing services that for now at least push Apple ahead of rivals Google and, which recently launched their own moves into music storage and streaming.

Jobs, whose decision to headline the event assuaged some concerns on Wall Street about his health, didn’t say a word about his condition but strode briskly onstage after James Brown’s soul classic “I Got You (I Feel Good)” blasted over the sound system.

“We’re going to move the digital hub, the center of your digital life, into the cloud,” Jobs said. “Everything happens automatically and there’s nothing new to learn. It just all works.”

In cloud computing, data and software are stored on servers, and devices like smartphones or PCs access them through the Internet.

With its knack for designing easy-to-use gadgets, Apple hopes to make cloud computing ― right now a term tossed about mostly by corporate IT departments and Silicon Valley geeks ― an everyday convenience for many people.

As more and more people use smartphones and tablets with limited storage, demand for cloud-based services is growing, and technology companies from Amazon to Zynga are rushing to stake out their turf.

Beyond storing music online, Apple’s revamped operating systems for its Macs, iPhones and iPads integrate cloud storage in everything from word processing to calendars and to-do lists, going beyond what other companies have done.

Apple’s new iTunes Match service will also scan users’ hard drives and automatically make the songs it finds available on the iCloud. In contrast, users of Google and Amazon cloud-based storage have to upload every song themselves.

Monday was only Jobs’ second public appearance since he went on medical leave in January. He shared the spotlight, letting his executive team showcase new features in Apple’s mobile and computer operating software.