The U.S. economy "isn't as weak as it's been portrayed" in the gross domestic product data, John Ryding, chief economist at RDQ Economics, told CNBC Friday.
"This morning for example, if you dig into the GDP report there's a pretty healthy gain in profits in the second quarter. And if you look at GDPs from the perspective of incomes it's actually running at 2 percent in the first half of this year, not the 0.7 that was reported." That number squares much more with industrial production and the employment gain we've had, he added.
The weekly jobless claims data is the best real-time indicator that Ryding uses. "They have actually been relatively steady throughout the month of August, close to 400,000 ... it's not really signaling stronger job gains but it's not signaling the labor market contracting either."
But he noted a key problem with the lack of job creation is that "small businesses haven't been engaged in the recovery in the same way big businesses have."
"The small business sector has been largely overlooked by government policies. In fact small business sector, which is primarily taxed under the personal tax-code, has actually been under the threat of higher tax rates down the road," Ryding concluded.
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