The Bureau of Economic Analysis said that strong consumer spending helped push real GDP growth higher, with real GDP growth revised up to 3.2 percent in the third quarter. It was originally estimated to be 2.9 percent growth, and both figures were the fastest quarterly growth rate in two years. Overall, this report was good news. With the U.S. economy expanding by only 1.1 percent at the annual rate in the first half of 2016, the third quarter numbers were entirely welcome, especially for consumer spending and net exports. Business investment remains a concern, but hopefully recovers moving forward with improvement confidence. In the end, real GDP will grow by 1.6 percent in 2016, but I expect stronger activity next year, with the current forecast being 2.5 percent growth. Read More
“We are going to fix our inner cities and rebuild our highways, bridges, tunnels, airports, schools, hospitals,” Donald Trump said. “We’re going to rebuild our infrastructure, which will become, by the way, second to none. And we will put millions of our people to work as we rebuild it.”
There’s reason to be optimistic. The President-elect made a number of strong campaign promises to the American people, one in particular caught our attention: his commitment to a sizable increase in our country’s infrastructure investment. Throughout his campaign, President-elect Donald Trump proposed spending up to $1 trillion during the next decade to make America’s infrastructure “second to none” and even repeated the promise earlier this month in his victory speech. Members of Congress have also shown a willingness to prioritize America’s infrastructure – in ways that bring greater economic returns than the stimulus plan six years ago.
This commitment is shared by manufacturers across the country. The NAM’s Building to Win blueprint for the new Administration and Congress estimates that addressing our ten-year funding gap will cost more than one trillion dollars. Additionally, the new Administration and Congress must improve regulatory and fiscal policies to incentivize increased levels of private investment in modernizing water and energy pipelines, railways and electricity systems. Read More
Coming on the heels of Thanksgiving and “Black Friday”, Small Business Saturday is a perfect opportunity for Americans to pause and contemplate the critical role small businesses play in our nation’s economy. Many small businesses are family-owned and are responsible for 62 percent of the country’s employment and $5.9 trillion of the nation’s GDP. Often with deep roots, these family-owned businesses play critical roles in the philanthropic and the economic heart of local communities. Read More
During this upcoming holiday season, should we be jolly about the economy? Are consumers opening their pocket books? How has the election impacted the US economy? What can consumers expect in 2017? The National Association of Manufacturers’ chief economist Chad Moutray, the National Retail Federation’s Jack Kleinhenz and the Consumer Technology Association’s Shawn DuBravac try to answer these questions and more in the latest Shopfloor podcast.
The Census Bureau said that new durable goods orders jumped 4.8 percent in October. New orders rose from an upwardly revised $228.4 billion in September to $239.4 billion in October. On a year-over-year basis, sales have increased 2.1 percent since October 2015, up from $234.5 billion. However, the data have been skewed by volatility in the transportation equipment segment. In October, transportation equipment orders soared 12.0 percent higher on strong sales for defense and nondefense aircraft and parts. Excluding transportation, new orders for durable goods increased 1.0 percent in October, but over the past 12 months, growth in activity has been more minimal, up just 0.3 percent.
Therefore, even with the healthy gains in demand seen in October, new orders growth for durable goods continue to be quite weak on a year-over-year basis, highlighting lingering challenges in the sector. Along those lines, core capital goods orders (or nondefense capital goods excluding aircraft) increased 0.4 percent in October, but have fallen 4.0 percent over the past 12 months. Read More
From Keystone XL to the most recent Dakota Access, debates over pipelines seem to have sprung up overnight. The pipes that connect us and deliver opportunity used to unite us, but lately the political agenda of a relative few has caused a riff. At a time when our country needs to come together more than ever, it’s dangerous is that much of the debate ignores the facts. Read More
Manufacturing and jobs were central issues in the presidential election, but what many Americans don’t realize is that manufacturers are looking for skilled workers right now. What’s more, we are expected to have many more job openings over the next decade. As many as 2 million jobs could go unfilled if we don’t start equipping people with the high-tech skills that manufacturing demands.
America is failing our youth if we do not equip them with the skills required for innovative manufacturing. Manufacturing careers pay about $15,000 more than the rest of the private sector, and manufacturing can provide job security and upward mobility like no other industry.
This is good news for working families at a time when some have lost faith in the American dream and are questioning our very system of free enterprise. But we should not give up; we should not lose hope. Strategic investment in education and training will carry us toward our goal.
It’s going to take all of us to forge the path forward, and many manufacturing companies are rising to the challenge. Check out this video, the third episode of FutureWork, featuring Dennis Parker, the founder of Toyota’s Advanced Manufacturing Technician Program, as he visits shop floors and explains the importance of, and opportunities available in, manufacturing careers.
President Obama has relied on, and expanded, the power of the administrative state by making substantial use of both executive orders and presidential memoranda to achieve policy objectives. Executive orders are appealing to any president because they can be quietly and quickly implemented without hearings, votes or substantive public feedback. President Obama has been direct in favoring this approach, stating, “We’re not just going to be waiting for legislation in order to make sure that we’re providing Americans the kind of help they need. I’ve got a pen and I’ve got a phone.”
The National Association of Manufacturers (NAM) ramped up its litigation in response to the tsunami of regulations coming out of the White House. In this final year of the president’s term, the regulatory spigot has only been turned up. The NAM is currently suing the federal government in 16 cases for overregulation.
The Manufacturers’ Center for Legal Action has argued in the courts that the president overstepped his constitutional power in issuing many memoranda and executive orders affecting labor and environmental law. However, a presidential legacy implemented by the pen can be destroyed by the pen. First, an executive order can be revoked by another executive order, and it is common for presidents to revoke some of their predecessors’ executive orders. Second, Congress can revoke an executive order through legislation. Third, an executive order can be revoked by a federal appeals court or the Supreme Court.
This year’s election will have a profound impact on future NAM litigation efforts to limit executive overregulation through the courts. President-elect Trump will fill the Supreme Court vacancy created by Justice Antonin Scalia’s death and potentially two or more additional seats as justices retire. If multiple vacancies occur, the Court will shift from its previous makeup of five conservative and four liberal justices that shaped some of the nation’s most significant issues on social norms, individual rights, the balance of government powers and business and workplace matters. Several if not all of the cases in which the NAM is suing the government for executive overreach may end up in a newly configured Supreme Court, and the outcome of President Obama’s regulatory legacy will largely rest on the Supreme Court nominees of President-elect Trump.
The Court has not had a liberal majority since the retirement of Chief Justice Earl Warren in 1969, and during the past 48-year period, the Court has made a modest shift to curtail executive overreach. Without a majority conservative Court, many pro-business decisions on labor and environmental issues would likely not have been rendered. It is generally thought that President-elect Trump will support Supreme Court nominees who believe the Founders’ words in the Constitution mean what they say, not that the Constitution should be seen as a living document. Justices in this mold will likely not support broad deference to executive authority and agency actions. The issues at stake range from the ability of citizens to challenge regulations by administrative fiat to the ability of workers to unionize.
The morning after the election brought with it discussion of whether Democrats will filibuster the Trump administration’s Supreme Court nominees. The Senate confirmation process will offer a critical view into the Supreme Court’s future and the legacy of President Obama’s executive orders.
The Census Bureau and the U.S. Department of Housing and Urban Development said that new housing starts jumped 25.5 percent in October to the fastest monthly pace since August 2007. New residential construction increased from an annualized 1,054,000 in September to 1,323,000 in October. To be fair, both of those figures are outliers to the year-to-date average of 1,169,100, with September’s surprising fall in activity followed by the strong rebound in October. Yet, the upward movement in this latest report is encouraging. Indeed, both single-family (up from 785,000 to 869,000) and multifamily (up from 269,000 to 454,000) made healthy gains in October, with single-family construction starts reaching a nine-year high. While I would expect a pullback in the November data to something closer to trend, housing starts should exceed 1.2 million by year’s end, which is positive. Read More
The Federal Reserve said that manufacturing production expanded modestly for the second straight month. Output in the sector was up 0.2 percent in October, which was the same as seen in September and consistent with consensus expectations. Despite the increase, manufacturers continue to grow at a much slower pace than desired. Along those lines, manufacturing production was down 0.2 percent on a year-over-year basis. Manufacturers have struggled to increase demand over the past couple years, with a strong dollar and global headwinds dampening overall activity. Indeed, manufacturing capacity utilization inched up from 74.8 percent to 74.9 percent, but that remained well below the 75.6 percent utilization rate seen one year ago. Read More