Tag: Jobs

Michigan Created the Most Manufacturing Jobs in July

The Bureau of Labor Statistics released regional and state employment numbers for July. The state with the most net new manufacturing jobs was Michigan, adding 7,600 workers in the month. This should probably not be a surprise given that motor vehicles along contributed 9,100 additional employees in the national jobs numbers for July, which were released earlier in the month. In fact, without the increase in auto sector workers, manufacturing employment would have fallen for the fifth straight month.

Beyond Michigan, the other top five states with manufacturing employment gains in July were Virginia (up 3,300), California (up 2,600), Ohio (up 2,400), and Georgia (up 2,200). Over the course of the past 12 months, states with the greatest increases in manufacturing jobs year-over-year included Michigan (up 48,800), Texas (up 28,000), Indiana (up 27,700), Ohio (up 25,600), and Washington (up 18,800).

Nationally, Nevada still has the highest unemployment rate at 9.5 percent, with Illinois (9.2 percent) close behind. The lowest unemployment rate continues to be in North Dakota with 3.0 percent, with South Dakota’s 3.9 percent also well below the national average.

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

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Rep. Paulsen Discusses the Trade Challenges in India with Manufacturers

Today Congressman Erik Paulsen (R-MN) joined the NAM’s India Task Force meeting to discuss the ongoing challenges resulting from India’s recent discriminatory trade practices. Paulsen and Congressman John Larson (D-CT) are circulating a letter urging Secretary of State Kerry to press for an end to this discrimination during his visit to India at the end of this month.

Congressman Erik Paulsen discusses India's discriminatory trade practices with manufacturers.

Congressman Erik Paulsen discusses India's discriminatory trade practices with manufacturers.

Manufacturers are already facing significant barriers to trade and India’s recent actions threaten the trade relationship with our fourth largest trading partner worth $60 billion just last year. The courts and policymakers in India are engaged in a persistent pattern of discrimination designed to benefits India’s economy at the expense of American jobs. Last week the NAM joined 16 other business groups in sending a letter to President Obama asking his Administration to directly engage the Indian government to stop these practices and to keep it from happening again in the future.

From the letter:

“These actions and others constitute a disturbing trend that may continue and even expand to other products, sectors, and countries.  Already there are indications that other countries are considering similar measures.  Such actions are completely at odds with recognized global norms and raise troubling questions about India’s compliance with its international obligations to protect ideas, brands, and inventions and to treat imported goods no less favorably than domestic products.”

The discussion with Congressman Paulsen today was a great opportunity for manufacturers to discuss the concerns about India with a member of the Ways and Means Committee. We will continue to urge members of Congress to ask the Administration to engage India’s government so we can protect American jobs.

 

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Manufacturers Pull Back on Hiring and Job Openings in March

The Bureau of Labor Statistics said that manufacturing job openings declined from 274,000 in February to 260,000 in March, according to the latest Job Openings and Labor Turnover Survey (JOLTS) report. The number of job postings has stayed by 300,000 since July 2012, staying within a narrow range of 240,000 to 275,000 since then. If there is a longer-term trend, it is that the number of job openings in manufacturing appears to have stalled after topping out at 324,000 in March 2012.

This is also consistent with what we are seeing in the net hiring data, which turned negative again in March for manufacturers for the first time since September 2012. Manufacturers hired 200,000 workers in March, the slowest pace in almost 4 years. This is down from 231,000 in February. Meanwhile, total separations – which include layoffs, quits, and retirements – declined from 225,000 to 205,000 for the month. On the positive side, the separations rate is at an all-time low in the JOLTS data’s 13-year history. Nonetheless, net hiring (or hiring minus separations) was -5,000 in March, down from +6,000 in February, reflecting significant weaknesses in the manufacturing sector.

Looking at the larger macroeconomy, there was some easing for job openings and hiring between February and March, but net hiring was still positive. The number of job postings declined from 3,899,000 to 3,844,000, with both figures representing 2.8 percent of total employment. Net hiring was 46,000, down from 271,000 the month before. The greatest monthly gains in hiring in March occurred primarily in the service sector, primarily from professional and business services (up 24,000) and education and health services (up 16,000).

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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February Employment Report Stronger than Expected

Manufacturers added 14,000 additional workers in February according to the Bureau of Labor Statistics. That is roughly equal to the average monthly gain of 13,000 experienced in 2012, with the first half of the year clearly being stronger than the later months. Even with this progress, we can’t help but hope to see better numbers with the manufacturing sector producing on all cylinders.

In his keynote address last month at the Detroit Economic Club NAM President and CEO Jay Timmons laid out a “20/20 Vision” for faster growth between now and 2020. This set a goal of having industrial production grow by 4.5 percent annually, manufacturers creating 20,000 jobs each month on average, and real GDP increasing at least by 3.5 percent annually. If we could achieve that growth imagine the possibilities.

February’s jobs numbers represent a good start, but there is still much more work to be done. Policymakers need to continue to focus on making the business environment as pro-growth as possible. Our manufacturers need policies to better compete globally. If that occurs, achieving an average job growth of 20,000 each month should be an easily obtainable goal.

Looking specifically at this month’s manufacturing numbers, durable goods employment rose by 6,000, with 8,000 additional workers in nondurable goods industries. Hiring growth was mostly mixed, despite the net increase in February. The largest gains were seen among fabricated metal products (up 6,400), wood products (up 4,000), food manufacturing (up 3,400), chemicals (up 2,600), transportation equipment (up 2,300), and plastics and rubber products (up 1,900). These were counteracted by declines in primary metals (down 2,000), machinery (down 1,800), electrical equipment and appliances (down 1,800), petroleum and coal products (down 1,500), and computer and electronic products (down 1,200). (continue reading…)

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ADP: Decent Gains in Employment in February, But Manufacturing Hiring Still Lags

Automated Data Processing (ADP) reported that nonfarm payrolls rose 198,000 in February, indicating that that nation’s job growth appears to be growing decently in the past four months. Nonfarm private payrolls have risen 225,000 on average from November to February, which is progress from the average increase of 163,000 for 2012 as a whole.

With that said, manufacturing sector job growth still lags behind. Manufacturers added 9,000 additional workers in February, which while better than in January, is still below the pace of one year ago. Manufacturers have added 8,000 workers on average for each of the past four months. This is above the average for 2012 of 6,000 workers, but below the 19,000 average monthly pace of 2011.

The distribution of additional nonfarm payroll workers was more evenly distributed than normal between small (e.g., those with less than 50 employees), medium (50 to 499 employees), and large (500 or more employees) businesses. Smaller firms added 77,000 additional workers, medium-sized entities contributed 65,000, and large businesses hired an additional 57,000 workers.  Using the traditional definition of a small business as one with less than 500 employees, this would suggest that 71.7 percent of the net new jobs were attributed to these firms.

Other industries with job gains in February included: trade, transportation, and utilities (up 45,000); professional and business services (up 35,000); construction (up 21,000); and financial activities (up 7,000). More of the net job increases came in the services industry (up 164,000) than in the goods-producing ones (up 34,000).

Tomorrow, we will receive official government data on employment from the Bureau of Labor Statistics. The consensus estimate is for 155,000 additional nonfarm payroll workers, but I would not be surprised to see a figure closer to 175,000. Manufacturing job gains should be similar to what was reported in this ADP survey.

Chad Moutray is chief economist, National Association of Manufacturers.

 

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Monday Economic Report – January 7, 2013

Here is the summary for this week’s Monday Economic Report:

With a last-minute deal to avert the fiscal cliff, manufacturers have fewer uncertainties to worry about at the start of the new year. The threat of an economic downturn appears to have largely dissipated, with modest growth in real GDP of 2 percent or so expected this year. However, while the agreement ensures that tax rates for most individuals will remain the same, marginal tax rates will rise for some manufacturing companies that are organized as pass-through entities.

The agreement delays budget sequestration for two months, but that only extends the uncertainty over how this matter will be resolved. In addition, policymakers did not even begin to address the long-term fiscal challenges that confront us by ensuring meaningful tax and entitlement reforms. However, because of the structure of the agreement, they will have additional opportunities to do so over the next few months when they must address the debt ceiling limit, sequestration and the soon-to-expire continuing resolution that funds the government.

The data released last week tended to reflect an economy that was strengthening, even as it continues to show signs of persistent weaknesses. On the employment front, manufacturers added 25,000 net new workers. This is a healthy figure to end the year on, with 180,000 additional jobs in 2012 and 522,000 since the end of 2009. Still, the pace during the second half of the year was much slower than the first half, and it would be encouraging to see the sector producing outsized output and employment growth again. Sentiment surveys have tended to show some manufacturers pulling back on hiring. This might change if business leaders see an economy on more solid footing.

There are some signs that the U.S. and global economic environments have stabilized. As noted in the Global Manufacturing Economic Outlook released on Friday, January 4, seven of our top 10 markets for manufactured goods are growing—an improvement from just three months ago when much of the world outside of North America was experiencing declines. Looking specifically at the U.S. market, the Institute for Supply Management’s (ISM) Purchasing Managers’ Index (PMI) shifted from contraction to a slight expansion last month, with export orders and hiring helping to lift the measure. While there is still much progress to be made on this front, the positive PMI number is good news. Similarly, the Dallas Federal Reserve Bank reported higher activity levels and increased manufacturing business confidence in its region.

This week, the key highlight will come on Friday with the release of new international trade data for November. The October data reflected reduced exports and imports as a result of slowing global growth. With improvements in some countries, we will see if manufactured goods exports begin to pick up. Other numbers to watch include data on consumer credit, job postings and small business optimism.

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

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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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ADP: Stronger Nonfarm Payrolls, But Manufacturing Employment Falls

Automated Data Processing (ADP) reported that nonfarm payrolls rose 215,000 in December, its strongest gain since February. The bulk of these jobs stemmed from the service sector (up 187,000), but there was also a healthy contribution from construction (up 39,000). The latter was the result of an improving housing market.

In contrast to these more-positive numbers, manufacturing continues to struggle. Manufacturers lost 11,000 workers on net in December, or 65,000 over the past six months. Indeed, there have been notable declines in production and new orders in the second half of this year, with economic uncertainties and slowing global growth forcing many businesses to pull back. Employment in a number of sentiment surveys have also indicated some hesitance for additional hiring; although, that sentiment might change in the coming months if the economy appears to be firming up.

Medium-sized (e.g., those with 50-499 employees) and larger (e.g., 500 or more employees) businesses accounted for the bulk of the net job increases in December. In the two size groups, there were 102,000 and 87,000 additional employees on net, respectively. Smaller businesses with less than 50 employees contributed 25,000 workers to the total.

In addition to the sectors listed above, other industries with more workers in December included trade, transportation, and utilities (up 53,000), professional and business services (up 37,000), and financial activities (up 14,000).

Tomorrow, we will receive official government data on employment from the Bureau of Labor Statistics. The consensus estimate is for 150,000 net new nonfarm workers, with manufacturing job gains continuing to be weak.

Chad Moutray is chief economist, National Association of Manufacturers.

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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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