Plus: Air Transport Activity, Signs of Asian Rebound, Top Cities for Biz Growth and MORE.

U.S. Trade Gap Expands
Recent data released by the Department of Commerce shows that the United States trade deficit widened in July, surpassing initial estimates for the month. July exports totaled $127.6 billion while imports came to $159.6 billion, bringing the goods and services deficit to $32 billion.

These figures reflect a 16.3 percent increase in the trade gap over May, making it the largest percentage increase since February of 1999 and significantly higher than the $27.5 billion predicted earlier for July, Agence France-Presse reports.

“The import and export improvements signal that economies are strengthening in the U.S. and abroad. The trade deficit, while widening, is far smaller than the $64.89 billion deficit at the same time last year,” the Wall Street Journal notes (subscription required).

The Commerce Department attributes the rise in exports to increased sales for automotive vehicles, engines and parts; capital goods; industrial supplies and materials; and consumer goods. The rise in imports reflects higher sales in the same sectors.

According to the Associated Press, “[e]conomists see the widening trade deficit as further evidence that the recession is coming to an end and they expect the imbalance in 2010 will be approaching the levels seen before the recession hit.”

OECD’s Stronger Signs of Recovery
A new report from the Organisation for Economic Cooperation and Development (OECD), which monitors trends among the world’s largest economies, has found strong signs of recovery in July among nearly all the markets tracked.

In July, the composite leading indicators (CLIs), which rely on a wide range of data series to signal turning points in economic slowdown or expansion, rose by 1.6 points for the United States, 1.9 points for the Eurozone, 1.4 points for Japan, 1.5 points for China, 1.3 points for India and 1.3 points for Russia, according to last week’s report.

Despite the positive data, “finance ministers and central bank heads from the Group of 20 leading economies Saturday said they remain cautious about the economic outlook, and won’t withdraw their stimulus measures until the hoped-for recovery is ‘secure,’” the Wall Street Journal reports (subscription required).

Part of the caution may be due to sluggish industrial output and sales among several European Union nations. Germany, Europe’s largest economy, saw its industrial production fall by 0.9 percent in July, according to AFP.

Although manufacturing output in the U.K. rose by 0.9 percent and France gained 0.3 percent, Spain, Slovakia, Hungary, Latvia, Estonia and Lithuania continued along several months of consecutive declines, with Finland experiencing its highest annual production drop since the fourth quarter of 1991.

Indicators of Economic Rebound in Asia
“China’s industrial production rose more than forecast in August, lending unexpectedly climbed and retail sales advanced, indicating growth in the world’s third-biggest economy is likely to accelerate,” Bloomberg News reports. Output at China’s factories gained 12.3 percent from a year earlier, the highest gain since August 2008, according to the National Bureau of Statistics of China in Beijing.

“China’s recovery gained momentum in August as stimulus spending helped boost industrial output, investment and retail sales in the world’s third-largest economy, offsetting a slump in exports,” the Associated Press says. Despite the “steady flow of positive figures over the past few months, China’s exports have remained sluggish, crimped by feeble demand,” the AP continues.

According to MarketWatch, the country’s shipments for the month were down 23.4 percent from a year ago [...] while exports contracted 17 percent against an expected 10 percent fall.” China’s overall trade surplus widened to $15.7 billion in August from July’s $10.6 billion.

Meanwhile, based on official data released last week, India’s industrial output climbed for the seventh consecutive month in July, driven by strong consumer demand, AFP reports. The country’s industrial output growth in July slowed from a 16-month high in June, but “manufacturing continued to hum, signaling that a recovery in Asia’s third largest economy is still on track,” according to the Wall Street Journal (subscription required).

Air Transport Economic Activity
Despite one of the most difficult financial periods in commercial aviation history, U.S. airlines have made measurable progress, according to the Air Transport Association of America’s (ATA) report on calendar year 2008.

“Annually, commercial aviation helps drive $1.1 trillion in U.S. economic activity and more than 10 million U.S. jobs,” the ATA’s 2009 Economic Report, released earlier this month, says. “On a daily basis, U.S. airlines operate nearly 28,000 flights in 80 countries, using more than 6,000 aircraft to carry an average of two million passengers and 50,000 tons of cargo.”

Cargo transport has accounted for 16 percent of total industry revenues and generated $5.3 billion more in sales than in 2008, reaching an all-time high of $30 billion, according to an ATA announcement.

Although industry operating revenues grew $11 billion in 2008, operating expenses surged by $24 billion. U.S. airlines saw cargo revenue ton-miles decline 15 percent year-over-year in June alone, representing the 11th consecutive month of declining volumes. In a separate report, from the International Air Transport Association (IATA), international scheduled-traffic results for July showed freight demand down 11.3 percent compared to the same month last year, “a relative improvement over the -16.5 percent recorded in June and the -19.3 percent average for the first seven months of the year.”

Although U.S. airlines have improved fuel efficiency by more than 120 percent over the past three decades, a $16 billion year-over-year spike in fuel expenses drove flying operations up 27 percent to $58 billion in 2008.

New U.S. Jobless Claims Fall
The number of Americans filing first-time claims for jobless benefits fell by 26,000, hitting 550,000 in the week ended Sept. 5, the U.S. Department of Labor reported on Thursday.

“The total number of people collecting unemployment insurance declined to the lowest level since April,” Bloomberg News notes.

The four-week moving average was 570,000, a 2,750 decrease from the previous week’s revised figure. The Labor Department’s August employment data showed unemployment hitting a 26-year high of 9.7 percent with 216,000 jobs lost.

Top Cities for Business Growth
While the economic recovery seems to be spreading, some U.S. cities and states are showing more promising conditions for business growth than others.

In its list of the 10 metropolitan areas with the largest number of expanding companies, Inc.com cited Washington D.C., New York and Los Angeles as the highest-growth cities.

The nation’s capital topped the list because more than half of its companies work primarily for the government, which has been spending funds at a record rate, while L.A. and its adjacent areas are succeeding with financial services firms and human resources companies. New York City’s success is buoyed by companies outside the five boroughs, including those in New Jersey.

Chicago, San Francisco, Boston and Atlanta are also among Inc.com’s top 10 metro areas for growing companies.