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Manufacturing Employment Declined Again in August

By | Economy, Shopfloor Economics | No Comments

In another sign that manufacturing in the United States remains weaker-than-desired despite some signs of recent progress, employment in the sector fell once again in August. Manufacturers hired 14,000 fewer workers on net in August, and the job gains for the prior two months were revised down by a combined 10,000. All in all, manufacturing employment has fallen by 39,000 year-to-date through August, suggesting continuing cautiousness among manufacturing business leaders to add workers in light of lingering weaknesses in the global economy. It is hard not to be disappointed by these numbers, particularly when combined with yesterday’s ISM data, which found that overall manufacturing activity contracted for the first time since February.

Durable goods firms shed 16,000 workers in August, with nondurable goods manufacturers adding 2,000 jobs for the month. Of the 19 major sectors in manufacturing, all but four had reduced employment in August. The largest declines were seen in the transportation equipment (down 6,400, including a 5,600 decline for motor vehicles and parts), primary metals (down 2,500) and nonmetallic mineral products (down 1,400). In contrast, there were employment gains in August for food manufacturing (up 4,500), paper and paper products (up 700), machinery (up 500) and petroleum and coal products (up 400). Read More

ADP: Manufacturing Employment Was Unchanged in August

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ADP said that manufacturing employment was unchanged in August after rising in July for the first time in six months. Overall, hiring in the sector has been challenged so far this year, with employment down by 33,000 workers through the first eight months of 2016. This suggests that manufacturers have been wary about adding to their workforce in light of ongoing global headwinds and sluggish growth in demand and production. Recent data have suggested some improvements in activity for U.S. manufacturers, and hopefully, this will translate into increased hiring moving forward for the sector. Read More

employment

The July Jobs Numbers Were Relatively Strong for the Second Straight Month

By | Economy, Shopfloor Economics | No Comments

For the second straight month, job numbers in the U.S. economy were relatively strong, with each above the consensus estimate. Nonfarm payrolls rose by 255,000 in July, extending the gain of 292,000 seen in June. As a result, the country has averaged 273,500 net new workers over the past two months, a decent jump over the 151,000 average seen over the first five months of 2016. This suggests that employers have begun to hire again despite continued cautiousness and lingering weaknesses in the global macroeconomy. The unemployment rate was unchanged at 4.9 percent. Yet, the so-called real unemployment rate – which includes discouraged workers, the underemployed and those working part-time for economic reasons – increased from 9.6 percent to 9.7 percent.

In the manufacturing sector, employers added 9,000 workers in July. This followed an increase of 15,000 in June, and like the nonfarm payroll numbers, it was an encouraging sign. With that said, manufacturing employment has declined by 15,000 on net year-to-date, suggesting that softness in demand and production in the sector have dampened hiring activity of late. Hopefully, employment growth for manufacturers continues to tick higher moving forward – something that is likely to happen if the sector continues to stabilize. Since the end of the Great Recession, manufacturers have added 852,000 workers. Read More

ADP: Manufacturing Employment Rose for the First Time in Six Months

By | Economy, Shopfloor Economics | No Comments

ADP said that manufacturing employment rose for the first time in six months in July, which was an encouraging development. Manufacturers added 4,000 workers on net in July. With that said, hiring in the sector has been challenged so far this year, with employment down by 33,000 workers through the first seven months of 2016. This suggests that manufacturers have been wary about adding to their workforce in light of ongoing global headwinds and sluggish growth in demand and production. Recent data have suggested some improvements in activity for U.S. manufacturers, and hopefully, this will translate into increased hiring moving forward for the sector. Read More

jobs

The June Jobs Numbers Provided Mixed News on the Labor Market

By | Economy, Shopfloor Economics | No Comments

The June jobs numbers provided mixed news on the labor market, but more than anything, they suggest that the U.S. economy remains much weaker than desired, particularly for manufacturing. On the positive side, manufacturers added 14,000 workers in June, which was encouraging. Yet, the sector has lost 24,000 employees through the first six months of 2016 – a sign that business leaders remain cautious in light of global headwinds and soft demand and production growth.

Likewise, the strong nonfarm payroll number for June, up by 287,000, would be more promising if not for the downward revision to May, up by just 11,000 instead of the originally reported figure of 38,000. Indeed, it is clear that nonfarm payroll growth has eased year-to-date. The U.S. economy averaged 147,333 additional nonfarm payroll workers in the second quarter, slowing from the 282,000 and 195,667 average paces seen in the fourth quarter of 2015 and the first quarter of this year. Along those lines, the unemployment rate rose from 4.7 percent in May to 4.9 percent in June, largely on an uptick in the participation rate from 62.6 percent to 62.7 percent. Read More

ADP: Manufacturing Hiring Down by 21,000 in June, Off for Fifth Straight Month

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ADP said that manufacturing employment declined for the fifth straight month in June, with the sector losing 21,000 workers for the month and 44,000 employees on net year-to-date. Moreover, hiring rose in just four of the past 12 months, losing 41,000 workers in that time frame. This suggests that manufacturers remain wary about adding to their workforce in light of ongoing global headwinds and sluggish growth in demand and production. Recent data have suggested some improvements in activity for U.S. manufacturers, but that has not yet translated into more job creation. Read More

Philly Fed: Manufacturing Activity Expanded Somewhat in June, but Growth Remained a Challenge

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The Federal Reserve Bank of Philadelphia said that manufacturing activity rebounded in June after contracting in both April and May. The composite index of general business activity rose from -1.8 in May to 4.7 in June. It was only the second time in the past ten months that activity has expanded, highlighting the challenges for the sector seen over much of the past year. The better headline number might have been a more encouraging sign, mirroring data from the New York Fed yesterday, if it were not for the fact that many other key measures in the Philly Fed report were lower. For instance, new orders (down from -1.9 to -3.0), shipments (down from -0.5 to -2.1) and employment (down from -3.3 to -10.9) pulled further into negative territory.  Moreover, the average employee workweek (up from -15.1 to -13.1) continued to shrink at a fairly fast clip, despite a slight easing in the pace of decline in June. Read More

NFIB: Small Business Sentiment Edged Slightly Higher in May

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The National Federation of Independent Business (NFIB) said that sentiment among small business owners edged slightly higher in May. The Small Business Optimism Index increased from 93.6 in April to 93.8 in May, its highest level since January. It marked some improvement from March’s two-year low in optimism, even as small firms continue to be concerned about the overall economic outlook. On this latter point, the headline index has remained below 100 – the threshold at which we would say that the sector was growing more strongly – since December 2014. Indeed, demand has been soft for small businesses, with the net percentage reporting higher sales in the last three months dropping from -6 percent to -8 percent. Looking ahead, the net percentage expecting sales to increase in the next three months was unchanged at 1 percent. Read More

ADP: Manufacturing Employment Declined for the Fourth Straight Month

By | Economy, Shopfloor Economics | No Comments

ADP said that manufacturing employment declined for the fourth straight month in May, with the sector losing 3,000 workers for the month and 23,000 employees on net year-to-date. Moreover, hiring has been stagnant over the past 12 months, with no change between the May 2015 and May 2016 levels of 12,311,000. Recent data have suggested some improvements in activity for U.S. manufacturers, but that has not yet translated into more job creation. Indeed, business leaders remain cautious about adding to their workforce with still-significant challenges to demand and production growth. Read More

jobs

Manufacturing Employment Rose in April after Following Sharp Declines in February and March

By | Economy, Shopfloor Economics, Shopfloor Main | No Comments

The current state of the manufacturing economy continues to be a give-and-take between signs that the sector is beginning to improve versus ongoing challenges related to global headwinds. The latest job numbers represent both of those views. On the one hand, manufacturers added 4,000 workers in April, a positive gain following two months of declines which was led by strength in the motor vehicle segment. Yet, hiring remained soft overall, with 23,000 fewer workers on net through the first four months of 2016. Indeed, manufacturing leaders remain cautious in their outlook, and as such, we continue to see weaker-than-desired job growth. Hopefully, that will improve moving forward, particularly if the manufacturing economy truly is beginning to stabilize. Read More