April 2021 International Trade, JOLTS, May NFIB

Robert A. Dye, Ph.D.

,

Daniel Sanabria

Shipping and Cargo

The U.S. international trade gap narrowed in April, taking a break from the widening trend that began in early 2020.



Trade Improves, Record Job Openings, Business Confidence Still Shaky

• The U.S. Trade Gap narrowed in April, to -$68.9 billion.
• Job Openings reached a new record high of 9.3 million in April. 
• The National Federation of Independent Business’s Small Business Optimism Index eased to 99.6 in May.

The U.S. international trade gap narrowed in April, taking a break from the widening trend that began in early 2020. Typically, in a global recession, the U.S. trade balance widens as the U.S. economy increases demand and pulls in imports before the rest of the world can absorb an increase in our exports. And so we see the nominal value of imports up $70.9 billion from a year ago, while exports were up by $54.9 billion for the year ending in April. For the month of April, exports were up by $2.3 billion over March supported by commercial aircraft while imports fell by $3.8 billion with fewer consumer goods coming in. The real (inflation adjusted) balance of trade in goods for April was below the first quarter average. This means that at the start of the second quarter, trade is poised to be a positive for Q2 GDP, but much could change in May and June. The slide in the value of the dollar through the second half of 2020 is supportive of U.S. exports and domestic production in 2021.

The Job Openings and Labor Turnover Survey (JOLTS) for April showed a new all-time high of 9.3 million job openings for the month. Hiring was little changed at a strong 6.1 million for the month. Quits increased to 4.0 million in April, indicative of a more confident labor force. Layoffs and discharges were little changed at 1.4 million. We expect hiring to remain strong as most states wind down enhanced unemployment benefits this summer.

The National Federation of Independent Business’s Small Business Optimism Index was little changed in May, easing slightly to a subdued 99.6. The index hit a recent high of 108.8 in August 2018. Labor shortages were a key feature of the May report which said that nearly half of small businesses struggled to fill open positions that month. According to the NFIB survey, small businesses were still drawing down inventory in May. They also reported that employee compensation is rising, as are prices. 

Market Reaction: U.S. equity markets were mixed after the open. The yield on 10-Year Treasury bonds is down to 1.54 percent. NYMEX crude oil is up to $69.58/barrel. Natural gas futures are up to $3.18/mmbtu.



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June 8, 2021
Robert A. Dye, Ph.D., Senior Vice President and Chief Economist at Comerica Bank

Robert A. Dye, Ph.D.

Senior Vice President and Chief Economist
Daniel Sanabria, Senior Economist at Comerica Bank

Daniel Sanabria

Senior Economist

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