Economy gains as businesses spend more, fire less

From wire reports
Posted Jan. 26, 2012, at 9:20 p.m.

WASHINGTON — Businesses are growing more confident in the economy, investing in more equipment and laying off fewer workers.

Government figures on manufacturing and unemployment claims released Thursday raised hopes on the eve of a report on how much the economy grew in the October-December quarter.

Still, 2011 ended up as the worst year on record for new-home sales, a reminder that the economy has a long way to go.

“Business optimism seems to be picking up, which is critical to the growth and competitiveness of the U.S. economy over the long haul,” said Diane Swonk, chief economist at Mesirow Financial.

Orders for manufactured goods expected to last at least three years rose 3 percent last month, the Commerce Department said. And demand for goods that indicate business investment plans hit an all-time high.

A tax break that expired in December for large equipment purchases may have helped boost orders. Still, many economists said most companies are likely buying equipment simply because business is improving.

US airfares continue to rise with demand

LOS ANGELES — As demand continues to rise for air travel, new federal statistics show that domestic airfares last summer set a record for the period.

In the July through September quarter, the average domestic airfare rose to $361, a 6 percent increase over the same period in 2010, according to data from the U.S. Bureau of Transportation Statistics.

The average airfare for the third quarter of 2011 was 0.5 percent higher than the previous record high, $359 for the same period in 2008. The bureau calculates the fare by taking an average of all domestic fares, including round-trip tickets and one-way fares.

The average fare, not adjusted for inflation, is the second highest amount for any quarter, behind the second quarter of 2011 when the average price was $370, according to the bureau.

As a result of higher fares and increased demand, most of the nation’s major airlines are reporting steady profits, despite high fuel costs. Delta Air Lines, for example, reported fourth-quarter net income of $425 million, compared with $19 million a year earlier.

http://bangordailynews.com/2012/01/26/business/economy-gains-as-businesses-spend-more-fire-less/ printed on November 21, 2014