The Institute for Supply Management’s (ISM) Manufacturing PMI continued to grow rather strongly, accelerating to its fastest pace since November 2014. The composite index rose from 54.5 in December to 56.0 in January, and it marked the fifth straight monthly expansion in the headline number. New orders (up from 60.3 to 60.4) and production (up from 59.4 to 61.4) expanded strongly in January. Along those lines, the sample comments all point to healthier conditions and stronger demand in the manufacturing sector, which is very encouraging. In addition, employment also picked up the pace (up from 52.8 to 56.1), suggesting that manufacturers have begun to move past the more cautious approach to hiring seen just a few months ago. Read More
Today more than 400 businesses and business organizations sent a letter to the U.S. Senate urging support for the confirmation of Wilbur Ross as secretary of commerce. Spearheaded by the National Association of Manufacturers (NAM), the letter urges swift action on Mr. Ross’ confirmation.
“We believe that Wilbur Ross will bring a unique understanding of what it takes to fuel manufacturing enterprises to this vital role,” the letter reads. “Mr. Ross has a firsthand understanding of the challenges manufacturers face to remain globally competitive in today’s economy.”
Read the full letter here.
NAM President and CEO Jay Timmons also sent a letter yesterday on behalf of the NAM offering his support for Ross’ confirmation.
“Wilbur is a businessman with extensive experience in a wide range of industries who knows firsthand what policies it takes to promote competitiveness, investment, job creation and durable economic growth,” Timmons wrote. “In particular, Wilbur has extensive experience in the manufacturing sector and understands the critical need for pro-growth trade, tax and other economic policies.”
Timmons’ letter is available in its entirety here.
The Bureau of Economic Analysis said that the U.S. economy grew 1.9 percent at the annual rate in the fourth quarter in preliminary data. This was slightly less than the consensus estimate for 2.2 percent, and it was slower than the 3.5 percent increase seen in the third quarter. Real GDP growth was buoyed by modest growth in consumer and government spending and by a continuing rebound in business investment, but net exports served as a drag on the headline number. Overall, the U.S. economy expanded 1.6 percent in 2016, down from its 2.2 percent post-recessionary average, and the year was mostly marked by an all-too-cautious approach to spending on the part of consumers and business leaders. Yet, by year’s end, that began to change – with many Americans and firms more willing to open their pocketbooks. Moving forward, I would expect 2.6 percent growth in real GDP in 2017 – a figure that can be assisted by pro-growth policies emanating from Washington including comprehensive tax reform, regulatory balance and investment in infrastructure.
Looking more closely at the underlying data, consumer spending on goods increased 5.2 percent at the annual rate in the fourth quarter, building on the 3.5 percent gain seen in the third quarter. This figure was boosted by strength in durable goods purchases including motor vehicles. Personal consumption expenditures added 1.70 percentage points to real GDP in the fourth quarter, with 0.58 percent coming from services and 1.11 percent stemming from goods spending.
Healthier business spending also served to boost real GDP growth, with gross private domestic investment adding 1.67 percentage points to the top line. It was the largest contribution to the real GDP since the second quarter of 2014. Residential and nonresidential fixed investment rose 10.2 percent and 2.4 percent in the fourth quarter, respectively, with both notching notable improvements from the third quarter. Indeed, residential spending rebounded from a sharp decline in the prior report, and equipment spending rose for the first time in five quarters. Inventories were also up significantly for the second straight quarter, accounting for a full percentage point of the 1.67 percent contribution in this category. Yet, it was not all good news, as nonresidential fixed investment in structures fell 5.0 percent in the fourth quarter.
Finally, manufacturers have been challenged over much of the past two years by a number of global headwinds. This has included a rapid appreciation in the U.S. dollar, as well as economic softness to many key markets. Along those lines, the contribution to GDP from net exports slipped back into negative territory in the fourth quarter for the first time in 2016, subtracting 1.70 percentage points to the headline number. (Put another way, if it had not been for net exports, real GDP growth in the fourth quarter would have been 3.6 percent, not 1.9 percent.) Goods imports jumped 10.9 percent in this release, with goods exports off by 6.9 percent.
This guest blog post is authored by Rebecca Lucore, head of CSR and sustainability, Covestro LLC.
At Covestro, we think of ourselves as the “new-old company.”
Formerly Bayer MaterialScience, Covestro was “reborn” in the fall of 2015 as its own, independent entity. Being independent means we can chart our own course—one that’s fully embedding sustainability into the heart of our business strategy.
As an innovative producer of advanced materials, it’s true our products enable other industries to make more energy-efficient products. In fact, this past summer, our ultra-lightweight coatings, polycarbonate and polyurethanes propelled the groundbreaking Solar Impulse—the world’s first 100 percent solar-powered aircraft—to complete its historic flight around the world without using a single drop of fossil fuel.
Solar Impulse was a virtual flying laboratory for clean technologies and material innovations. The cockpit featured our adhesives and coatings, as well as our polyurethane foam, which provided the insulation that kept the pilot safe and comfortable in wide-ranging temperatures. This highly efficient insulating foam, which saves 70 times more energy than is used to make it, is now being used in modern refrigerators. The plane’s polycarbonate windshield was another real energy saver, which is why the auto industry uses it in cars and trucks, understanding that the lighter the weight, the more fuel efficient the vehicle.
We know the manufacturing process behind these materials requires a lot of energy, so we’re continuously developing processes and solutions that reduce our energy use and carbon dioxide (CO2) emissions. Going forward, four-fifths of our research and development will be dedicated to delivering sustainable solutions through our products and processes, and these projects will be tied directly to the 17 Sustainable Development Goals established by the United Nations Global Compact, which we’ve signed on to.
But this isn’t just about the future. We’ve already made real progress. Read More
Thank you, Mr. President. Manufacturers welcome the president’s swift move to provide no new burdens to the onslaught of regulations we have endured these past eight years. One after another, regulations—on everything from health care and energy to workplace conversations—have made keeping our doors open harder and harder.
Today’s announcements are great first steps, and we hope this is a sign of more positive actions to come.
As the incoming Trump administration prepares to reform and roll back many misguided federal regulations, the National Association of Manufacturers (NAM) has released a new study revealing the sheer number of business and operational hurdles that manufacturers face on a daily basis as a result of the nation’s current regulatory structure. Read More
The Federal Reserve said that manufacturing production rebounded in December after pulling lower in November, with output in the sector up 0.2 percent in the latest report. Manufacturers have struggled to increase demand over the past couple years, with a strong dollar and global headwinds dampening overall activity, but recent data have started to reflect a turnaround in sentiment. In that regard, manufacturing production grew 0.2 percent year-over-year in December, its first positive reading since June but still indicating essentially stagnant growth over the past 12 months. Similarly, manufacturing capacity utilization edged up from 74.7 percent to 74.8 percent, which, despite some progress, continued to be below the 75.2 percent utilization rate observed one year ago. Read More
I was struck by The New York Times article on Okla. Attorney General Scott Pruitt, the nominee to be Environmental Protection Agency (EPA) administrator, and the settlement of a long-simmering Arkansas poultry runoff case. I encourage you to take a look at a very different side of the story and its impact here.
It’s fascinating to see the nature of the criticism being leveled against Mr. Pruitt by environmental groups, former EPA administrators and other opponents—and here’s why: he doesn’t view the EPA’s role, and his potential role as administrator, the same way they do. He’s different. And they don’t like it.
But shouldn’t he be different? Shouldn’t he represent change from the status quo? Voters just elected Donald Trump president, in large part, because he pledged to be a disruptor, to dramatically change the way the federal government interacts with—well, everyone. The EPA is no exception. Read More
This afternoon, the U.S. Supreme Court granted certiorari to the National Association of Manufacturers’ (NAM) petition in the challenge to the Environmental Protection Agency’s (EPA) Waters of the United States regulation. We have asked the Supreme Court to review a decision from the U.S. Court of Appeals for the 6th Circuit, where many suits challenging the WOTUS rule have been consolidated. The panel’s decision conflicts with decisions in similar cases by other federal appeals courts, which concluded that such challenges should be heard at the district court level. The NAM outlined in detail why 33 U.S.C. Section 1369(b) does not allow courts of appeals to hear this challenge. The 6th Circuit’s decision put challengers to the EPA rule in an untenable position—if that court does not actually have jurisdiction to hear the case, any action it takes could thereafter be overturned on appeal, without even considering the merits of the challenge, and we would have to start the case over at the trial court level. This would be a tremendous waste of resources for manufacturers and other parties affected by the rule, the administration and the courts. Delaying review of the jurisdictional question, which must ultimately be resolved in any case, makes no sense, so we are very pleased that the Supreme Court decided today to resolve this issue.
National Association of Manufacturers (NAM) President and CEO Jay Timmons issued the following statement on the Bureau of Labor Statistics’ December employment data:
“Despite an increase in manufacturing employment in December, the sector lost 45,000 workers in 2016. That is unacceptable. To really accelerate job growth and fully reach our economic potential, manufacturers are looking to the incoming Trump administration to take bold actions, beginning on day one. To spur job creation right here in the United States, we want to see smart reforms on regulations, taxes, health care, energy and more. But to achieve that, we need a fully functioning government, so we are calling on the Senate to act swiftly on the president-elect’s Cabinet nominees. Unnecessary delays mean lost opportunities for manufacturers and the men and women who make things in America.”
“Manufacturers and the NAM appreciate the incoming administration’s willingness to listen to our concerns and seek our insights. If leaders on both sides of the aisle can come together, we can revitalize modern manufacturing in America—and lift our economy and country to new heights.”
CONTACT: Jennifer Drogus, (202) 637-3090