United States Economic Forecast for 2015

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Will September Sales Slump Temper Holiday Hiring? More Companies Announce Hiring Plans!

Retail sales slumped in September, according to the latest report from the Commerce Department. The question is, does the 0.3 percent decline signal potential difficulties when it comes to all-important holiday sales? “Consumers’ spending power certainly is not being helped by stagnant wages,” said John Challenger, CEO of global outplacement consultancy Challenger, Gray & Christmas, Inc. “However, consumers should find more money in their pockets heading into the holidays, thanks to job gains and falling gas prices. These factors will definitely help retailers who are also hoping to lure shoppers with lower prices.” Nationwide, retailers are poised to go on a holiday hiring binge. Many are already adding extra workers to their payrolls, and this alone, according to Challenger, should help fuel increased sales over the holidays. “We should not read too much into the September sales slump. It falls between back-to-school shopping and the holiday season. Sales could see a rebound in October, as Americans spend millions on Halloween costumes and decorations. This momentum could carry over into the holidays as shoppers feel more comfortable spending on items they may have held off on in recent years,” said Challenger. What is the outlook for holiday hiring this year? Are hiring plans based more on sales projections, traffic projections, or something else entirely? Will lower gas prices help boost holiday spending?

China’s Economy Overtakes the U.S. as World’s Largest

By Lucy Westcott of Newsweek Magazine

Filed: 10/8/14 at 10:29 AM  | Updated: 10/8/14 at 11:11 AM

Participants holding flags and placards gather for the gay pride parade in Hong Kong on November 9, 2013. Philippe Lopez/AFP/Getty

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Filed Under: U.S., China, Economy, International Monetary Fund

China has overtaken the U.S. as the world’s largest economy, but only when it comes to purchasing power.

The International Monetary Fund (IMF), which measures countries in terms of market exchange rates and purchasing power parity (PPP), found thatChina contributes the most to global growth, the Financial Times reported Tuesday.

China gross domestic product is worth $17.6 trillion, while U.S. GDP is $17.4 trillion, with adjustments made for China’s low cost of living, according to the IMF’s latest World Economic Outlook.

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According to PPP logic, prices of goods aren’t the same in each country, so when making adjustments based on a country’s purchasing power—and converting a currency into its dollar equivalent—China is beating the U.S.

As Business Insider explains, “Though a typical person in China earns a lot less than the typical person in the U.S., simply converting a Chinese salary into dollars underestimates how much purchasing power that individual, and therefore that country, might have.”

In April, the Financial Times’s Chris Giles predicted the Chinese economy would overtake the U.S. But the U.S. maintains the lion’s share in terms of the raw value of its currency, one area where China has some catching up to do.