Job growth---Carmen (fast)
>> we’re back now. cigna says it will cut jobs and is slashing its dividend despite an increase in profit last quarter. cigna says it plans to eliminate about 3,000 positions this year and take a first quarter charge of as much as $75 million. that’s in addition to nearly 4,000 job cuts announced last year. let’s go to cigna’s latest earnings release. the insurer says it earned $2.06. that’s in the fourth quarter. up from a prior 33 cents. and better than the median estimate of $1.40 per share. cigna says earnings got a boost from lower medical costs for its health plans. shares are up more than 60% in the past year. the u.s. economy added 112,000 jobs last month while unemployment fell to 5.6%. the job growth was slower than expected. other data show as a stronger economic picture. carmen roberts joins to us explain the dispart between the two sides.
>> yes, matt. when you look at all this week’s economic data, there is a lot of evidence to show the u.s. economy is moving long at a healthy pace. claims for unemployment are down. the average about 345,000 for the january period. that’s the fewest since february of 2001. the survey shows businesses have been in the mood to hire for three months. and the unemployment rate fell as more than 400,000 people said they found work. contrast that with a payroll report showing u.s. only added 112,000 jobs.
>>if you look at the two series together, one starts turning up late 2001. the other doesn’t turn up until about eight months ago. i think if you split the difference, you do have that modest recovery which, again is not gangbusters at this point but it is improving.
>> and charles mcmilan, a chief economist for m.b.g. information services when you put that together and consider the fiscal stimulus of the past two years has been so great, the u.s. economy should be blazing ahead and we’re not. what’s going on? why are u.s. businesses not hiring at the 200,000 a month pace needed to show sustainable economic growth?
>> we had this strange circumstance over the past year where businesses were quite pessimistic. they were not looking for strong goth growth. they got it but because it wasn’t expected, they were being conservative with hiring plans we’re in a different ball game now.
>> and the game should pick up and job growth will hit the 200,000 territory before the end of this quarter. economist william cheney says businesses are being unnaturally cautious right now.
>> they’re making a lot of profit which normally would be enough to get them to start hiring. i think we’re on the cusp of it. i think there’s a lot of industries that are really starting to see their demand get ahead of their capacity. but it’s still a matter of faith and hope rather than actual data.
>> faith and hope. and that may explain why many economists have overestimating job growth.
>> carmen, thanks very much. time now for a check of today’s top world and national news stories. president george w. bush named former senator chuck robb and senior u.s. court of appeals justice lauren silverman to lead a commission to probe the accuracy of u.s. intelligence on overseas weapons threats.
