Strengthening jobs market could boost consumer spending

With the holiday season in full swing, consumers are expected to increase expenditures. Now that more data has been released showing a strong jobs market, spending could pick up even further, potentially creating a need for short term lending in the near future.

Private sector employment increased by 215,000 jobs in November, according to the ADP National Employment Report. Small businesses led the way, adding 102,000 positions, followed by medium- and large-businesses creating 65,000 and 48,000 jobs, respectively.

"The job market remained surprisingly resilient to the government shutdown and brinkmanship over the treasury debt limit," said Mark Zandi, chief economist at Moody's Analytics. "Employers across all industries and company sizes looked through the political battle in Washington. If anything, job growth appears to be picking up."

The service-providing sector accounted for the majority of jobs gains, with all five industries experiencing growth.

Carlos Rodriguez, president and CEO at ADP, said November's employment gains were the strongest of any month in 2013. He added that this is an encouraging sign leading into the new year.

Another positive sign for the jobs market is continued decreases to initial jobless claims. According to the U.S. Department of Labor, first-time applications for unemployment benefits dropped by 10,000 claims to hit 316,000 in the week ending November 23. This brought the four-week moving average to 331,750, a decrease of 7,500 applications.

"The figures are indicative of the kind of job growth we've been getting over the last couple months," Michael Hanson, U.S. senior economist at Bank of American Corp, told Bloomberg. "We've been moving forward but we're not at a robust place yet."

Short term lending demand may rise if spending picks up
If consumers do increase expenditures this month - and into the future - an increasing amount of people may find themselves in trouble financially. Americans generally spend more money during this time of the year without an additional earnings, which could make it difficult to handle an unexpected expense.

For example, if someone's car breaks down and requires a significant repair following the holidays, it may be hard to cover this expense as well as other monthly essentials. In such a situation, late fees and penalties may be incurred if a payment is missed, which could make the situation worse.

However, consumers don't have to end up in such a troubling predicament, as short term lending could help them stay current on all expenses. By securing a short term loan, consumers are able to get funds quickly to pay all essentials when an unexpected expense arises.

Unfortunately, many people avoid this type of lending due to past negative press. Critics attack short term lending claiming high fees and interest rates are charged. But, it is important to look at the big picture. When an unexpected expense presents itself, people may fall short on essentials leading to late fees and penalties. If the cost of a short term loan is less than these charges, people could really benefit.