Fewer firings could signal stronger economy, greater purchase order finance demand

In the past couple of months, the employment situation has been a strong point for the economy, and that trend continued in mid-July, which could help boost economic growth. 

As the economy grows at a faster pace, business picks up across numerous industries. Small- to medium-sized manufacturers and wholesalers might begin to see orders larger than they are used to handling, potentially leading to increased demand for purchase order financing

Jobless claims fall markedly in mid-July
Initial applications for unemployment benefits decreased more than forecast in the week ending July 13, according to the U.S. Department of Labor. Claims declined by 24,000 to 334,000, which is the lowest total since early May. Economists surveyed by Bloomberg called for a drop to 345,000.

In order to continue the momentum, this slowdown in firing must be sustained, which could help boost income growth and household spending. 

"The labor markets are healing, and as companies see further demand for their goods and services, there is certainly less risk for job loss," Russell Price, senior economist at Ameriprise Financial, told Bloomberg. "Claims are certainly indicative of an improving job market, but not a particularly robust one."

Another positive sign for the labor market is the continuing improvement of The Conference Board Employment Trends Index, which increased slightly in June to 111.64. While this was only slightly higher than the previous month, the ETI was up 3.8 percent year-over-year. 

Purchase order financing can help growing businesses
If the strengthening jobs market helps boost the economy, business at small- to medium-sized manufacturers and wholesales could pick up. When companies of this size see large orders, some sort of financial assistance is usually needed to fill them. 

Luckily, purchase order financing is available, as these businesses are often turned away for traditional forms of borrowing provided by banks. This type of lending agreement allows manufacturers and wholesalers to obtain up to 100 percent of the funds needed to fill an order. 

As a result, businesses of all sizes are able to take advantage of potential game-changing opportunities that could come in the form of large orders from big-box retailers such as Target or Walmart. Additionally, owners of these companies are able to retain 100 percent equity as they don't need to sell off part of their business to fill an order.