US financial news summary | 3 September 2023
Headlines: Sunday 3 September 2023
- Employment report: 736,000 people enter job market, unemployment at 3.8%
- Job openings fell in July to a more than 2-year low, pointing to slowdown
- US quarterly growth slower than expected in Q2
- Minimum wage in Florida set to increase in September
- Minimum wage in California to go up in 2024
- New requirements to receive SNAP benefits in 2024 to take effect soon
In the US, Labor Day has been held on the first Monday in September since the 1880s. There have been efforts to switch it to May to align it with International Workers’ Day, but remnants of Cold War tensions have soured this endeavor.
What will be happening with fuel prices today
With visits to the pump rather flat and the price of oil hovering around the $80 per barrel mark, the national average for a gallon of gas will likely stay where it is through this holiday weekend. Hurricane Idalia may cause regional price jumps due to station damage, flooded roads, and power outages, but as in past years, these things are usually fixed in a few weeks.
Previous years’ prices have been affected more by Labor Day demand, but analysts believe there will be no significant change in the price of fuel this time around.
That doesn't mean they aren't already comparatively high.
Labor Day fuel prices are high
Labor Day weekend is typically one of the busiest travel weekends in the United States. Many people take advantage of the long weekend to go on vacations, visit family and friends, or simply enjoy a short getaway.
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The application period for federal student loans has ended. You need to have submitted a Free Application for Federal Student Aid, or FAFSA, by the end of June 2023.
The only other option for getting a student loan is a private loan. These can be applied for and ratified within hours if you meet the requirements.
Hurricane Idalia brought significant damage and flooding as it passed through the southeastern United States. Following its passage, federal disaster assistance was made available to the state of Florida to supplement recovery efforts in the affected areas.
If you live in one of these areas, you may qualify for assistance that may include grants for temporary housing and home repairs, low-interest loans to cover uninsured property losses, and other programs to help people and business owners to boost their recovery.
The COLA represents an increase in Social Security payments. Each month, the Social Security Administration sends different checks, including those for retired workers and survivors (children, spouses, widows, widowers or parents of a deceased beneficiary). These recipients are the people who will benefit from a new cost of living adjustment.
Here is the date on which the amount of the COLA increase will likely be announced.
Americans less confident in economy amid high gas prices
Higher gas prices and a slowdown in inflation reduction soured consumer confidence in August, according to The Conference Board.
New data showed that the Consumer Confidence Index fell to a reading of 106.1 in August, down from 114 in July and below the 116 number expected by economists.
"August's disappointing headline number reflected dips in both the current conditions and expectations indexes," said Dana Peterson, chief economist at The Conference Board.
"Consumers were once again preoccupied with rising prices in general, and for groceries and gasoline in particular," per Yahoo Finance.
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Consumers who want to do some grocery shopping on Labor Day will find many available options, because most retailers and supermarkets will be open on Monday.
A large number of commercial establishments will be open for business, but they may have reduced hours.
Here are the business hours of some of your favorite retailers.
Labor Day is a federal holiday celebrated on the first Monday in September each year. It honors and recognizes the American labor movement and the contributions of workers to the development of the country.
Being financial institutions, most banks follow the Federal Reserve Schedule which includes Labor Day on the list of holidays that they celebrate. The Central Bank will not be operating on Monday, and most high street banks will do the same.
The US childcare crisis
Come 30 September, child care support that was expanded during the covid-19 pandemic will end. An assessment by The Century Foundation, a non-partisan think-tank, states that 3.2 million children are set to lose child care with 70,000 programs ending.
The cutting to funding will mean higher costs for parents as well as a widening staff shortage. The industry is 40,000 workers short of its pandemic number as it is. The states which will be worst hit are Texas, New York, and Florida.
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The Supplemental Nutrition Assistance Program, formerly known as food stamps, is a federal program that, in coordination with state governments, provides benefits to low-income families to buy food.
This program is administered by each state, so some aspects of the benefits may vary, such as the program’s name. In the case of the state of California, SNAP is known as CalFresh. These payments are sent during the first 10 days of each month based on the last digit of each beneficiary's case number.
This is the California SNAP benefit payment schedule for September 2023.
The US has a growing demographic time bomb. At the 2020 census the population stood at 331 million people, growing 7.4% since 2010. This was the slowest increase since the great depression and will be compounded by the aging population.
You would think that efforts would be made to address this issue, either with increased immigration or by making it cheaper for new parents to raise children.
On the contrary, the US has eye-wateringly expensive childcare.
US employment data for August released
The latest data showed an increase in unemployment to 3.8%, the highest since February 2022, while non-farm payrolls increased by 187,000.
The US monthly jobs report is produced by the Bureau of Labor Statistics. This data provides institutions the information necessary to carry out certain actions, such as the Federal Reserve setting interest rates.
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The COLA is announced once the CPI-W data, corresponding to July, August and September, are available for calculation. The official COLA for 2024 will be announced in October this year.
The COLA would go into effect in December and would be applied for the first time in Social Security and SSI payments in January 2024.
These are the predictions for its size.
A crucial aspect of the data is the focus on ‘non-farm’ payrolls. Unsurprisingly, this does not count farm workers in the data.
Non-farm payroll refers to the total number of paid workers in the US, though it excludes employees in the agricultural sector, non-profit organizations, and government employees.
Good morning and welcome to AS USA's live financial blog!
As September gets into full swing, follow along as we bring you the latest news on SNAP benefits, Social Security updates, and student loan repayment plans.
We'll also be reporting on other financial news affecting US consumers as the job market cools, consumers ramp up spending, and the government continues working to bring down inflation.