The U.S. economy added 165,000 nonfarm payroll jobs in April, and there were upward revisions of 114,000 additional nonfarm workers in the months of February and March. The higher February number suggests that job growth in that month was now the highest in almost 3 years. Indeed, for the larger economy, the employment data including the revisions could be perceived as somewhat positive. Yes, we would like to see even greater job gains on a month-by-month basis, but the economy added almost 196,000 workers on average in the first four months of 2013. This is higher than the nearly 183,000 average of 2012.

The unemployment rate fell to 7.5 percent. This is the lowest level since December 2008. At that time, the rate was on its way up, topping off at 10 percent in October 2009. The unemployment rate was 9 percent in April 2011, illustrating its descent in the past two years. Its decline can be explained by two factors: an improving jobs picture and a falling participation rate. In April, the participation rate was unchanged at 63.3 percent. As noted last month, this rate is the lowest since May 1979.

For manufacturers, the news has been less positive. Manufacturing employment was unchanged in April, only slightly lower than the gain of 2,000 workers experienced in March. The revisions to February and March data added 9,000 workers to those two months. Still, over the past 12 months, the sector has actually shed 10,000 workers, illustrating significant weaknesses for manufacturers, especially after July 2012. As we have noted since then, some of the challenges have been slowing domestic and global sales and fiscal and regulatory uncertainties. Recent surveys indicate that this softness persists in March and April data of manufacturing activity on weaker new orders, with hiring continuing to be skittish as long as policies out of Washington continue to provide uncertainty and undue burdens.

Looking specifically at manufacturing sectors, durable goods industries added a net 1,000 workers in April, which was counteracted by a net decline of 1,000 workers from nondurable goods businesses. Manufacturing sectors with employment gains for the month included machinery (up 3,600), transportation equipment (up 3,000, with 2,400 from motor vehicles), fabricated metal products (up 2,500), and food manufacturing (up 2,300). On the negative side, sectors with losses in April were printing and related support activities (down 3,100), apparel (down 2,900), computer and electronic products (down 2,000), wood products (down 1,700), and nonmetallic mineral products (down 1,300).

Reflecting the flat nature of the employment data, overall compensation in the manufacturing sector was also essentially stalled, declining marginally. Average weekly earnings in the sector decreased from $985.73 in March to $982.91 in April. In addition, there were slightly fewer hours worked on average. The average weekly hours in manufacturing in April were 40.7 hours, down from 40.8 hours the month before. Moreover, average overtime hours dropped from 3.4 hours to 3.3 hours.

In short, the manufacturing sector has not performed as well as the larger economy when it comes to jobs gains. This is not to suggest that nonfarm payroll growth is stellar – because it is not – but at least we have seen upward movement in overall hiring. Nonfarm payroll growth is approaching 200,000 on average each month, which is decent and higher than what was seen last year.

Yet, hiring in the manufacturing sector leaves a lot to be desired, going beyond the stalled growth of April. Over the course of the past 12 months, manufacturers have added just over 6,000 workers on net each month. That is well shy of what we like to see coming from the sector, and it is a sign of just how soft new orders and other activity have been for the industry of late. As noted in February in a speech by NAM President and CEO Jay Timmons, we would like to see average monthly job gains of around 20,000. To achieve this “20/20 Vision” – as it has been dubbed – manufacturers will need pro-growth policies stemming from Washington, and it will require stronger economic growth overseas, which will help to drive greater exports.

Chad Moutray is the chief economist, National Association of Manufacturers.

According to the Bureau of Labor Statistics the manufacturing sector added 25,000 net new workers in December, its strongest monthly gain since March. This stands in contrast to the ADP figures released yesterday, which have found six straight months of declining manufacturing employment. The official government data reflect a more-positive uptick for the sector.

Over the course of 2012, manufacturers hired an additional 180,000 workers on net, or 10 percent of all nonfarm payroll jobs created this year, the majority of which were created in the first half of 2012. This was slower growth than we had hoped to see, clearly the fiscal cliff and other uncertainties had an impact in the second half of the year. 

Looking more specifically at the December manufacturing employment numbers, durable and nondurable goods sectors added 11,000 and 14,000 workers, respectively. Most of these gains can be largely contributed to rebuilding after Sandy as construction jobs also saw an increase of 30,000.

The largest gains were seen in the motor vehicle and parts (up 4,800), food manufacturing (up 4,500), chemicals (up 4,300), nonmetallic mineral products (up 3,500), plastics and rubber products (up 2,100), and machinery (up 2,000) businesses.

Even with this uptick in December several areas of weakness were found in manufacturing. We saw losses in electrical equipment and appliances (down 2,100), fabricated metal products (down 700), paper and paper products (down 500), apparel (down 400), and furniture and related products (down 400). (continue reading…)

The Bureau of Labor Statistics reported that the economy added 69,000 net new jobs in May, with manufacturing up just 12,000. This is another disappointing labor report which is consistent with recent weaknesses we’ve seen in the global and domestic marketplace. Several other recent economic indicators have shown growth easing in the spring months. Both manufacturers and consumers are anxious about Europe and uncertain about long-term tax policies. 

The unemployment rate edged slightly higher to 8.2 percent, up from 8.1 percent in April. Looking at the so-called real unemployment rate, which includes discouraged and underemployed workers, that figure rose from 14.5 percent to 14.8 percent.

Manufacturers have increased employment over the past six months by 173,000 net workers, or 16.5 percent of all of the nonfarm payroll jobs added during that time. Since the end of 2009 manufacturing has added 487,000 workers.

The sector remains a bright spot, with outsized contributions to both employment and output but we have to do much better in order to continue to drive economic growth. Manufacturers need policies from Washington which will enable them to invest, create jobs and remain competitive against global competition. Currently they are facing many difficult challenges and headwinds which are negatively impacting job growth.

Durable goods industries added 13,000 jobs in May, with nondurable companies shedding 1,000. The fastest growth was seen in motor vehicles (up 5,800), fabricated metals (up 5,700), primary metals (up 3,800), beverage and tobacco products (up 2,700) and machinery (up 2,500).

Chad Moutray is chief economist, National Association of Manufacturers.

Today’s Labor Department jobs report showed employment rose 120,000 in March over February, considerably less than analysts had been expecting, and about half the average gain of the previous three months. 

Manufacturing employment, however, was a bright spot in the figures. Outperforming the economy as a whole, the March manufacturing jobs gain accounted for nearly one-third of the entire private sector increase. 

Manufacturing employment rose 37,000 in March, the second-strongest gain in the last 12 months, and continuing the manufacturing jobs gain that began in January 2010.  Since that time, manufacturing has gained 470,000 jobs – and has seen employment grow 10 percent faster than in the rest of the private sector.

Durable goods employment continued its strong growth pattern, gaining 26 thousand jobs in March.  Reflecting resurgent motor vehicle production in the United States, the March employment gain in that sector accounted for nearly half of the entire durable goods employment increase.  Non-durable goods employment rose 11,000.

The strong growth in manufacturing that has been going on since January 2010 is clearly visible in the attached graphs, as is the robust performance of the durable goods sector and the lackluster record in non-durables employment. (continue reading…)

The Bureau of Labor Statistics reported that consumer prices rose 0.4 percent in February, faster than the 0.2 percent increase in January. As we saw with yesterday’s producer prices release, higher energy costs led this acceleration, up 3.2 percent. Gasoline prices alone went up 6 percent. On an annual basis, consumer prices are up 2.9 percent.

This increase is a prime example of the need for an “all of the above” energy strategy to take advantage of our domestic resources to lower energy prices.

Food prices were unchanged overall. The prices of fats and oils, for instance, were offset by falling prices for meats, daily, fruits and vegetables. When food and energy costs are excluded, core inflation is running at 2.2 percent, essentially unchanged from the 2.3 percent reading last month.

Outside of food and energy prices, other consumer cost changes were mostly modest. Apparel was one of the exceptions, with prices down 0.9 percent. This reverses the 0.9 percent gain last month.

Overall, consumer inflation remains modest, but with the recent run-up in energy costs, prices have accelerated. This will squeeze Americans’ pocketbooks, and depending on how sustained it is, it could also zap consumer confidence in upcoming surveys.

Chad Moutray is chief economist, National Association of Manufacturers.

The Bureau of Labor Statistics (BLS) observed a higher number of job openings in January in the manufacturing sector, according to new Job Openings and Labor Turnover (JOLTS) data. Manufacturers posted 285,000 new jobs in January, up from 252,000 in December. The bulk of this increase occurred in durable goods industries, with nondurable goods manufacturers’ also upping their job postings slightly.

This is obviously a positive sign of future hiring intentions, but it contrasts somewhat with actual hiring activity in January. Both net hiring and net separations figures dropped in the month. The number of manufacturing hires fell from 269,000 in December to 246,000 in January. December’s figure appears to indicate a rush of hiring before the end of the year, which was not sustained in January. Likewise, separations for the industry dropped from 239,000 to 213,000. These numbers suggest net hiring of 33,000 in January.

Looking at the larger economy, job openings, hirings and separations were all lower in January than December. Growth in manufacturing job openings was one of the bright spots. There were 3,459,000 job openings in January, compared to 3,540,000 in December. Still, the longer-term job openings trend is a positive one, as there were 2,860,000 job openings overall in January 2011. This can also be seen in the attached graphic for the manufacturing sector.

Likewise, the overall job market has improved at the state level, as well. BLS also released state and regional employment information for January showing mostly lower unemployment rates and higher levels of nonfarm employment. The lowest unemployment rate in the U.S. is still in North Dakota at 3.2 percent, with Nevada having the highest at 12.7 percent. The largest monthly improvements in the unemployment rate were found in Mississippi (now 9.9 percent) and Missouri (now 7.5 percent), with each down 0.5 percentage points since December.

Looking at the manufacturing sector, the largest monthly gain occurred in Michigan, up 16,300 workers in January. This reflects recent gains in the motor vehicle sales. On a year-over-year basis, Michigan has added 31,800 manufacturing jobs since January 2011, the most of any state. Other states with large increases in manufacturing employment in the past year include Texas (up 25,900), Ohio (up 17,700), Indiana (up 16,900), Washington (up 16,400), Iowa (up 11,800), South Carolina (up 11,200) and Illinois (up 10,500). These gains speak largely to growth in durable goods production in many of these regions.

Chad Moutray is chief economist, National Association of Manufacturers.

With consumers and businesses more confident, the U.S. economy continues to expand modestly. An improved – but still weaker-than-desired – jobs picture is part of that. The U.S. added 227,000 net new jobs in February, or 1.2 million in the past six months. Manufacturing has played a significant role in the recent rebound and since the end of the recession. In fact, over the past three months, manufacturers have added 111,000 new workers as overall activity has picked up. The manufacturing sector has contributed over 13 percent of all net new jobs created in the nonfarm economy since December 2010.

To be fair, the recent job gains in manufacturing have not been as broad-based as we might prefer. They have stemmed primarily from durable goods producing industries, with nondurables continuing to lag. This trend has been fairly consistent over the past two years, yet it would be nice to see greater employment gains across-the-board. Of course, this also mirrors industrial production data, with stronger growth tending to concentrate among the motor vehicle, aerospace, fabricated metals, machinery and primary metals sectors.

One of the larger threats to growth is a slower global economy. Mario Draghi, the European Central Bank president, announced a lower forecast for real GDP growth, with output slightly contracting for the continent as a whole this year. Meanwhile, other economies are also slowing. China, for instance, just cut its growth target to 7.5 percent. This slower growth shows up in the international trade figures released on Friday. Goods exports dropped in most regions of the world, including those to China and Europe. Increased imports of petroleum were another factor, with the overall trade deficit widening for the third consecutive month.

This week, we will gain further insights into the strength of the current rebound. New industrial production figures will be released on Friday, following regional survey data from New York and Philadelphia. The Federal Reserve Board will also announce on Tuesday whether or not it intends to pursue any new monetary policies. As always, the Fed will be mindful of inflation, and later in the week, the Bureau of Labor Statistics will issue updates on both consumer and producer prices. In addition to those releases, other highlights for the week include updates on consumer and small business sentiment, job market turnover and retail sales.  

Chad Moutray is chief economist, National Association of Manufacturers.

The U.S. economy added 227,000 net new jobs in February, according to the Bureau of Labor Statistics. This was a stronger-than-expected increase, but it was still below the revised gain of 284,000 in January. Manufacturers added 31,000 net new workers, bringing the sector’s three month increase to 111,000. Since December 2010, the manufacturing sector has generated 316,000 net new jobs. Over the same time period, there were 2.35 million nonfarm payroll jobs added in the past 14 months. Therefore, 13.4 percent of all of the nonfarm payroll jobs added in those 14 months were from manufacturing. 

Much has been made of the participation rate lately, as we have seen a drop in the number of people employed over the past few months. The participation rate rose from 63.7 percent in January to 63.9 percent in February. Still, the rate was 64.2 percent in February 2011. Meanwhile, the number of discouraged workers dropped 53,000 in the month. The “real” unemployment rate – which included discouraged and underemployed workers – is now 14.9 percent, down from 15.1 percent last month.

Looking specifically at the February job gains in manufacturing, all of the net job gains stemmed from the durable goods sector, which rose by 31,000. Nondurable sector employment was flat. The largest gains came from fabricated metal products (up 11,400), transportation equipment (up 8,300, including 5,600 from motor vehicles), machinery (up 4,500), furniture and related products (up 3,100) and beverages and tobacco products (up 2,300). Declining sectors included printing and related support activities (down 2,500), miscellaneous manufacturing (down 1,600) and paper products (down 1,300).

The average workweek for manufacturers rose slightly from 40.9 hours in January to 41.0 in February. The average amount of overtime remained at 3.4 hours. Likewise, the average weekly earnings for manufacturing workers rose from $977.51 to $979.90.

Overall, these numbers show continued strength in the U.S. economy, with manufacturing playing a key role in the recent rebound. While total nonfarm payroll and manufacturing employment grew somewhat below the gains of January, the job gains of the past three or four months have been impressive. Manufacturers continue to express cautiously optimistic about activity over the next few months – something which bodes well for employment growth in the sector.

With that said, it is also clear that manufacturers are closely following the developments in Europe and the tax and regulatory discussions in DC. The recent run-up in energy and raw material prices has also captured their attention. Therefore, as we have noted for a while, anxieties about possible threats to the economy continue to persist, even as the domestic outlook has become more positive.

Chad Moutray is chief economist, National Association of Manufacturers

According to Automated Data Processing (ADP), manufacturers added 21,000 net new employees in February, up from an increase of 16,000 in each of the past two months. This suggests that the stronger growth in industry employment has continued into February. Goods-producing firms – which include manufacturing, construction, and mining – added 46,000 net new jobs. This is the fifth consecutive month of gains in the goods-producing sectors, with 146,000 more employees added in that time frame.

For the economy as a whole, there were 216,000 new nonfarm, private payrolls, up from 173,000 last month. Small and medium-sized employers (e.g., those with less than 500 employees) accounted for all but 20,000 of those jobs.

Of course, the ADP figures are a precursor for the release of the official jobs report from the Bureau of Labor Statistics (BLS) on Friday. BLS reported 243,000 new nonfarm payrolls jobs and 50,000 manufacturing workers in January. Expectations are slightly lower payroll numbers for February, with the current consensus estimate of 150,000 new nonfarm payroll jobs. 

Chad Moutray is chief economist, National Association of Manufacturers.

U.S. employment numbers jumped significantly higher in January, according to the Bureau of Labor Statistics, with the unemployment rate dropping to 8.3 percent.  Moreover, nonfarm payrolls grew by 243,000, and manufacturers added 50,000 net new workers. These gains were greater than expected, and certainly, much higher than the estimates from ADP released two days ago. Consensus estimates had been for around 150,000 net new jobs with the unemployment rate remaining around 8.5 percent.

These numbers continue to affirm the rebound and importance of manufacturing to our economic recovery. There were 82,000 net new jobs created in the sector in the past two months. This is definitely a sign that manufacturers have picked up their activity of late. Moreover, manufacturers have added 287,000 of the 2,063,000 net new nonfarm payroll jobs generated in the last 13 months (since December 2010); this suggests that nearly 14 percent of all of the jobs generated in that time frame stemmed from manufacturing.

As I noted last month, though, we would be remiss without mentioning the fact that employment remains a significant challenge, even with today’s good news. The “real” unemployment rate – which includes discouraged and underemployed workers – is now 15.1 percent, down from 15.2 percent in December and 16.1 percent last year at this time.

There are currently 2.81 million Americans who are classified as “marginally attached to the labor force,” with 1.06 million being discouraged workers. This is up slightly from last month. (The civilian labor force also grew last month, from 240.58 million to 242.27 million.)

Looking specifically at the January 2012 figures, the bulk of the new jobs in manufacturing came from the durable goods sector, which was up 44,000 for the month. The largest gains came in fabricated metal products (up 10,900), machinery (up 10,500) and transportation equipment (up 10,300). Nondurable goods sector employment rose by 6,000 in January. In that sector, the strongest growth came in the chemicals (up 2,200), printing and related support services (up 1,700) and beverages and tobacco products (up 1,300) sectors.

The average workweek for manufacturers rose from 40.6 hours in December to 40.0 hours in January. The average amount of overtime edged slightly higher from 3.3 to 3.4 hours. Therefore, the average weekly earnings for manufacturing workers rose from $969.93 to $977.51.

Overall, these numbers show renewed strength in the domestic economy, with employment growth in almost every major industrial sector except information, financial services and government. It mirrors other recent economic indicators showing an uptick in activity since October. Moreover, several sentiment surveys suggest that manufacturers are optimistic about future production and employment in 2012, which should bode well for this year’s numbers.

Yet, it is important to remember that significant headwinds exist both in Europe and in the U.S. The labor and housing markets – while improving – still have a long way to go before they are healthy, and consumer and business optimism is mixed with persistent anxieties. Still, we will take good news when we can get it.

Chad Moutray is chief economist, National Association of Manufacturers.