US economy back on top

<p>Kia ora,</p><p>Welcome to Friday's Economy Watch where we follow the economic events and trends that affect New Zealand.</p><p>I'm David Chaston and this is the International edition from Interest.co.nz.</p><p>And we should note that this is the 500th edition of Economy Watch. Thank you for joining us.</p><p>Today we lead with news normal service seems to be been resumed, with the giant American economy regaining its role as the engine of global growth.</p><p>In the US, the number of <a href="https://www.challengergray.com/blog/challenger-job-cuts-report-job-cuts-remain-low-as-summer-starts-hiring-announcements-fall/" target="_blank"><strong>recorded job layoffs</strong></a> in May is now down to about -25,000 among large reporting companies and very much back to pre-pandemic levels.</p><p>The level of <a href="https://www.dol.gov/sites/dolgov/files/OPA/newsreleases/ui-claims/20210998.pdf" target="_blank"><strong>initial jobless claims</strong></a> came in lower than expected, but only slightly so. There are now 3.5 mln people on these benefits, still more than pre-pandemic, but far far less than a year ago when there were 19 mln people dependent on them.</p><p>Tomorrow we get the official non-farm payrolls report for May and it is expected to show a modest improvement (+650,000) from the unexpectedly weak April result (+266,000). Today we got the precursor <a href="https://adpemploymentreport.com/2021/May/NER/NER-May-2021.aspx" target="_blank"><strong>ADP Employment Report</strong></a> and it came in much better than expected with a +978,000 rise in jobs with gains across the board, except in the IT industry. Half those overall gains were in the hospitality sector.</p><p>The two large PMI surveys reported their May data for the large services sector and both describe booming conditions. <a href="https://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/services/may/" target="_blank"><strong>The ISM one</strong></a> and <a href="https://www.markiteconomics.com/Public/Home/Press