WASH­ING­TON - The US econ­o­my is pick­ing up. If on­ly job growth would fol­low. A spate of da­ta yes­ter­day showed US fac­to­ries grew last month at the fastest pace since June, con­struc­tion spend­ing in­creased for a third straight month, and both re­tail sales and au­to sales rose in No­vem­ber. But the num­ber of peo­ple ap­ply­ing for un­em­ploy­ment ben­e­fits is still too high to sig­nal strong hir­ing. The re­ports of­fered a mixed pic­ture for the econ­o­my one day be­fore the gov­ern­ment re­ports on job growth in No­vem­ber. Econ­o­mists project that em­ploy­ers added a net 125,000 jobs. That's not enough to low­er the un­em­ploy­ment rate, which is pro­ject­ed to stay at 9 per cent for the sec­ond straight month.

And man­u­fac­tur­ers could face strains over­seas in key ex­port mar­kets, es­pe­cial­ly if Eu­rope's debt cri­sis wors­ens and leads the con­ti­nent in­to an­oth­er re­ces­sion. For now, fac­to­ries are grow­ing. The In­sti­tute for Sup­ply Man­age­ment, a trade group of pur­chas­ing man­agers, said yes­ter­day that its man­u­fac­tur­ing in­dex rose to 52.7 in No­vem­ber, up from 50.8 in Oc­to­ber. Any read­ing above 50 in­di­cates ex­pan­sion. Fac­to­ries have grown for 28 straight months. Bradley Hol­comb, chair of the ISM's sur­vey com­mit­tee, said man­u­fac­tur­ers "are cau­tious­ly more op­ti­mistic about the next few months based on low­er raw ma­te­ri­als pric­ing and favourable lev­els of new or­ders."

Still, com­pa­nies have tem­pered their out­look with con­cerns about fu­ture eco­nom­ic growth, gov­ern­ment reg­u­la­tion and the debt cri­sis in Eu­rope, he added. New or­ders rose to a sev­en-month high and pro­duc­tion in­creased, ac­cord­ing to sep­a­rate in­dex­es in the re­port. Ian Shep­herd­son, an econ­o­mist at High Fre­quen­cy Eco­nom­ics, said the gains sug­gest fac­to­ry out­put will ex­pand at an even faster pace next month. "The econ­o­my seems fi­nal­ly to be de­vel­op­ing re­al mo­men­tum; growth is ac­cel­er­at­ing," he said in a note to clients.

But a mea­sure of fac­to­ry em­ploy­ment fell. The drop in­di­cates man­u­fac­tur­ers are still hir­ing, but at a slow­er pace than the pre­vi­ous month. "Man­u­fac­tur­ers are try­ing to meet de­mand with­out sig­nif­i­cant­ly in­creas­ing their work force," said Ryan Wang, an econ­o­mist at HS­BC Se­cu­ri­ties. Work­er pro­duc­tiv­i­ty rose in the Ju­ly-Sep­tem­ber quar­ter by the most in 18 months, while la­bor costs fell, the gov­ern­ment said Wednes­day. A more pro­duc­tive and less-cost­ly work force can boost cor­po­rate prof­its. But un­less com­pa­nies see more de­mand, they're un­like­ly to step up hir­ing.

AP