Tag: employment report

Manufacturing Employment Falls Again in May

Manufacturing employment fell by 8,000 workers in May according to the Bureau of Labor Statistics. With the latest revisions to the data, this was the third consecutive month of declining employment in the sector, a sign of just how weak activity has become in recent months. Manufacturers have added just 41,000 workers over the past 12 months or just 1.9 percent of total non-farm jobs created, signifying that the sector’s contributions are well below what we need to see. Since the second half of 2012, the manufacturers have been challenged by slowing global sales, U.S. fiscal woes, higher taxes, and reduced government spending. To the extent that the industry is growing, it has been modest at best, dampening the enthusiasm for job growth.

The decline in manufacturing employment occurred in both durable and nondurable goods industries, down by 2,000 and 6,000 respectively. Areas of strength included motor vehicles (up 2,400), wood products (up 1,300), computer and peripheral equipment (up 1,100), and chemicals (up 900).  But, these gains were lessened by declines in the printing and related support (down 3,200), machinery (down 3,100), food manufacturing (down 2,800), and primary metals (down 2,200) sectors, among others.

On the positive side, the average weekly earnings of workers in the manufacturing sector rose slightly, up from $803.40 to $804.65. Likewise, the average number of hours worked were unchanged at 41.8 hours, with overtime hours off from 4.3 hours to 4.2 hours on average.

The Bureau of Labor Statistics said that nonfarm payrolls rose by 175,000 in May, just slightly above the expectations of around 165,000. At the same time, the labor participation rate edged up somewhat from 63.3 percent in April to 63.4 percent in May. This contributed to the unemployment rate increasing from 7.5 percent to 7.6 percent.

The May report confirms that the U.S. economy is modestly growing. The service sector appears to be the main beneficiary of this growth. For manufacturers, these data are quite frustrating, as they are indicative of many of the larger trends that we are seeing for the sector. Recent reports show that new orders have been soft, with exports challenged by weaker economies overseas and persistent domestic uncertainties.

Manufacturing needs to be firing on all cylinders if we are going to have robust economic growth. When manufacturers are once again making significant contributions to output and employment, as they have overall since the end of the recession, we will see significant economic growth. Washington must move forward with policies that will help eliminate the headwinds and uncertainties that are limiting hiring and growth.

Chad Moutray is chief economist, National Association of Manufacturers.

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Manufacturing Sheds Jobs in March

Manufacturing employment declined by 3,000 in March according to the Bureau of Labor Statistics, its first decrease since September. Manufacturing employment has been soft over much of the past year, with just a few exceptions. The sector has added 77,000 net new workers over the past 12 months.

Over that time frame, there were 1.9 million nonfarm payroll workers hired, implying that manufacturers created just 4 percent of all of the net new jobs since March 2012. That really illustrates how uncertainty and weak global demand have impacted a sector that had before last year been providing outsized growth for output and employment. Since the end of the recession, manufacturers have hired an additional 510,000 workers, or roughly 9 percent of all new jobs.

Looking specifically at the manufacturing employment numbers for March, the durable goods sectors added 4,000 additional workers, with nondurable goods industries shedding 7,000. The largest monthly gains were seen in the fabricated metal products (up 3,400), machinery (up 3,000), primary metals (up 2,000), and plastics and rubber products (up 1,200) sectors. In contrast, some of the sectors with declining employment for the month included apparel (down 2,500), food products (down 1,600), wood products (down 1,300), and textile product mills (down 1,000).

The data on hours worked and compensation in the manufacturing sector were largely unchanged in March. The average weekly earnings for the industry edged marginally lower from $987.74 to $986.14. On the positive side, weekly earnings remain higher than the $978.84 average observed in January. In terms of average weekly hours, they also were slightly off, down from 40.9 to 40.8. This was somewhat counteracted by an increase in the average overtime hours of 3.4 in March, up from 3.3 in February. (continue reading…)

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Stronger Manufacturing Gains in December, Challenges Remain

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…)

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Manufacturing Employment Falls in November

Nonfarm payroll gains were slightly higher than anticipated in November, according to the Bureau of Labor Statistics. The consensus estimate had been for roughly 100,000 or so nonfarm payroll workers added in the month, and today BLS reported that there were 146,000 additional workers added in November.

Part of the higher figure stems from the fact that Hurricane Sandy had less of an impact than some economists expected. The other surprising element was the reduction in the unemployment rate from 7.9 percent to 7.7 percent. This phenomenon was largely the result of a reduced participation rate, from 63.8 percent to 63.6 percent.

In November we saw more bad news for the manufacturing sector. Manufacturers shed 7,000 workers in November, building on the weak economic environment that we have seen since July. The industry has lost 26,000 workers on net in the past four months. Prior to that point, the manufacturing sector had added 172,000 employees in the months of January through July, or 16.3 percent of all of the nonfarm payroll jobs created in the first seven months of the year. It is clear that this outsized role in net job creation has come to a standstill since the summer.

Slower sales growth and uncertainties related to the U.S. economic climate have taken their toll on the manufacturing sector. The latest NAM/IndustryWeek Survey of Manufacturers released yesterday, reiterates this point. There has been a substantial deterioration in the percentage of manufacturers who say that their company’s business outlook is positive. More troublesome the survey showed that average expectations for capital spending and hiring over the next 12 months has turned negative for the first time since 2009. In fact, almost 43 percent of respondents said that they had reduced or slowed down their business investment, and more than 36 percent said that they have reduced employment or stopped hiring. (continue reading…)

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Manufacturers Add Just 2,000 New Jobs in November

The Bureau of Labor Statistics (BLS) reported that the national unemployment rate fell from 9.0 percent in October to 8.6 percent in November, its lowest level since March 2009. There were 120,000 net new nonfarm payrolls for the month, including 2,000 new manufacturing jobs.

Manufacturers have added just 6,000 net new jobs since July; whereas from January 2010 to July 2011, they generated 302,000 in new employment. While there have been some indications that net employment in manufacturing will pick up especially as we move into the new year, it is clear that job growth in the sector has slowed down considerably in recent months.

Breaking this down between different manufacturing sectors, durable goods have done better of late than nondurables. In November, durable goods sectors added 10,000 net new jobs relative to the loss of 8,000 in employment from the nondurable goods industries.

The sectors with the fastest employment growth for the month were fabricated metal products (up 8,300), transportation equipment (up 5,200) and machinery (up 3,800). Industries losing the most jobs in November included computer and electronic products (down 3,400), food manufacturing (down 3,300), printing and related support activities (down 3,200) and miscellaneous manufacturing (down 3,000). (continue reading…)

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Unemployment Rate Down to 9 Percent, Manufacturers Hire 5000 More Workers in October

The Bureau of Labor Statistics (BLS) reported that overall nonfarm payrolls increased by 80,000 in October, which was slightly below expectations. Yet, the overall employment rate edged down from 9.1 percent in September to 9.0 percent in October, and manufactures hired an additional 5,000 workers on net for the month. Some of the previous months’ data was revised upward as well.

For manufacturing, there have been 303,000 net new jobs added since December 2009. Given that there were 2.2 million new nonfarm jobs added during that time, manufacturing has accounted for roughly 13.8 percent of the new growth in the past 22 months. This is slower than the 16 percent attributed to manufacturing a few months ago, but manufacturing growth has slowed somewhat since July.

Looking at specific sectors within manufacturing, durables experienced net hiring of 11,000, with nondurables shedding 6,000 workers for the month. The sectors with the fastest employment growth in October were transportation equipment (up 9,500, with 6,200 stemming from motor vehicles and parts), machinery (up 3,900), primary metals (up 2,300) and petroleum and coal products (up 1,300). The largest declines came in chemicals (down 2,800), miscellaneous manufacturing (down 2,400), printing and related support activities (down 1,900), plastics and rubber products (down 1,600) and communications equipment (down 1,500).

The average workweek edged slightly higher, from 40.3 hours in September to 40.5 hours in October, with the average amount of overtime remaining constant at 3.2 hours. In addition, the average weekly earnings for manufacturing rose from $958.74 to $967.95.

Despite the lower unemployment rate, these numbers continue to show an economy that is growing insufficiently to generate enough jobs. However, the net 5,000 increase in manufacturing employment was a nice improvement from the past two months, which experienced modest declines. (continue reading…)

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Manufacturers Shed 13,000 Jobs in September

The Bureau of Labor Statistics reported that overall nonfarm payrolls increased by 103,000 in September, and it also upwardly-revised data for the past two months. The previous estimate for nonfarm payroll growth in August was zero, but that is now changed to an increase of 57,000 jobs for the month.

Overall, there are over 1 million net new jobs created in the economy this year. As the BLS press release clearly states, 45,000 of the jobs in the September numbers came from the return of telecommunications workers from their strike.

Manufacturers shed 13,000 workers in September, which added to the loss of 4,000 employees in the sector in August. Overall, the manufacturing industry has increased employment by 176,000 since the beginning of this year and 285,000 since December 2009.

Looking at specific sectors within manufacturing, there were sources of strength for hiring. This included chemicals (up by 1,400 workers), machinery (up 2,800), plastics and rubber products (up 1,400), primary metals (up 1,400 workers) and transportation (up 1,000). Sectors with the largest declines included fabricated metal products (down 2,900), furniture and related products (down 3,600), printing and related support activities (down 4,200), miscellaneous manufacturing (down 3,000) and textile product mills (down 2,200). In total, durable goods sectors lost 8,000 jobs in the month, while nondurable goods declined 5,000.

The average workweek in manufacturing edged slightly lower, from 40.3 hours in August to 40.2 hours in September, but the average amount of overtime was up from 3.1 to 3.2 hours. Essentially, average hours worked in the week were unchanged. Meanwhile, average weekly earnings slid from $954.71 to $953.14.

These numbers continue to show that the manufacturing sector is experiencing some significant weaknesses. This contrasts with its robust growth earlier this year. While some segments of the industry and some regions of the country are faring better, sluggish economic growth, worries about the global marketplace and sagging consumer and business confidence are taking a toll. It is imperative that this situation reverse itself so that manufacturers can return to higher levels of production and employment. Policymakers need to implement pro-growth policies now.

Chad Moutray is chief economist, National Association of Manufacturers.

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Video: NAM Economist on the July Employment Report

National Association of Manufacturers Chief Economist Chad Moutray discusses the July Employment Report in this video:

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Unemployment Falls to 9.1 Percent, Manufacturing Employment Up in July

The Bureau of Labor Statistics reported that overall nonfarm payrolls increased by 117,000 in July, which was better than expected, and the unemployment rate dropped to 9.1 percent. Private sector jobs were up 154,000, with manufacturers hiring an additional 24,000 workers.

In addition, data for May and June were revised, and the manufacturing sector added 7,000 and 11,000 jobs, respectively, in those two months.  Since December 2009, manufacturers have created 289,000 new jobs, or over 15 percent of the total change in nonfarm employment over that time frame.

Within manufacturing, durable goods accounted for 23,000 of the net new employment, led by a healthy increase in workers at motor vehicle assembly plants (up 12,000). This is a sign that the automotive sector is beginning to recover from the supply disruptions of the spring. Fabricated metal products (up 4,500), furniture and related products (up 2,800), computer and electronic products (up 2,500), plastics and rubber products (up 2,100) and food manufacturers (up 1,700) also saw gains.

The average workweek for manufacturers was unchanged between June and July at 40.3 weekly hours and 3.1 overtime hours. Meanwhile, average hourly earnings ticked higher for manufacturing workers, up from $23.68 per hour in June to $23.79 in July.  The unemployment rate for manufacturers is currently 9.2 percent, unchanged from the previous month, with 9.6 percent within the durable goods sectors and 8.5 percent for nondurables.

In short, these numbers are an improvement. After a couple weaker months of job growth, manufacturing employment is once again moving in the right direction, led by the durable goods sector. It is important to note the bounce-back in employment within the automotive sector, which has been challenged since the Japanese earthquake and tsunami with supply chain issues. Hopefully, this bodes well for future growth in that sector.

However, manufacturers are still facing significant headwinds in the economy, as we saw yesterday with falling equity prices worldwide. To the extent that global economic problems – particularly in Europe – spread, this could have a major impact on confidence and growth in the coming months, limiting employment growth. Regulatory uncertainty is continuing to impact growth for manufacturers.

In addition, while a U.S. debt deal was enacted this week, much of the focus this fall will be on deficit reduction. As these numbers show, the public sector will continue to be a drag on both economic and job growth moving forward, but to the extent that we can get our fiscal house in order, the positives might outweigh the negatives.

Chad Moutray is chief economist, National Association of Manufactures.

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June Employment Numbers Disappoint

With many analysts expecting stronger growth in employment in June, numbers released this morning from the Bureau of Labor Statistics were somewhat disappointing. Nonfarm payrolls increased by just 18,000 and the unemployment rate rose to 9.2 percent.

May employment figures were also revised downward, with only 25,000 nonfarm payroll jobs created that month. Thus, job creation over the past two months has been minimal, and certainly not enough to absorb the influx of new people into the workforce.

The manufacturing picture was mixed with 6,000 jobs created during the month. This reverses a slight decline in employment in May. Durable goods employment rose 15,000, but nondurable good manufacturers lost 9,000 workers.

Strong employment gains in fabricated metal products (up 7,800), machinery (up 4,100), and miscellaneous manufacturing (up 2,500) were offset by losses in food manufacturing (down 7,900), wood products (down 5,100), and plastics and related support activities (down 2,500). (continue reading…)

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