Tag: JOLTs

Monday Economic Report – April 14, 2014

Here is a summary of this week’s Monday Economic Report:

In the minutes of its March Federal Open Market Committee (FOMC) meeting, the Federal Reserve Board highlighted the negative impact of weather events on first-quarter growth. Winter storms hampered business investment, construction, consumer spending and manufacturing production. Nonetheless, the Federal Reserve still anticipates real GDP growth of between 2.8 and 3.0 percent in 2014, faster than last year’s 1.9 percent expansion. While this reflects a slight downgrade in the outlook for the year from the last forecast, it continues to suggest that the economy will regain its momentum moving forward. The Federal Reserve also predicts growth of 3.0 to 3.2 percent in 2015. The International Monetary Fund’s World Economic Outlook, which was released last week, mirrors these figures in its own forecasts for the United States.

The highlight of the FOMC minutes was the background discussion among participants regarding future monetary policy actions. The Federal Reserve largely feels that the U.S. labor market has a lot of “slack” in it, which is not reflected by the 6.7 percent unemployment rate. Despite improvements in the unemployment rate, weaknesses continue, with the participation rate near 30-year lows and high rates of both underemployment and part-time employment. While some FOMC members feel there has been sufficient economic progress to warrant less stimulative monetary policy measures, the majority view the current labor market as sufficiently weak enough to continue the Federal Reserve’s highly accommodative actions for the foreseeable future. The Federal Reserve will continue to reduce its long-term asset purchases, but short-term interest rates will likely not rise until next year at the earliest. Inflationary pressures remain modest, providing the Federal Reserve with some wiggle room to do its stimulative measures.

The most recent Job Openings and Labor Turnover Survey (JOLTS) data suggest the labor market for manufacturers remains soft. The number of manufacturing job openings declined for the third month in a row in February. Postings have been lower since peaking in November, and the December to February time frame mirrored the weather-related weaknesses seen in other data. Net hiring was also lower in those three months, with 2,000 more separations than hires in February. Still, the manufacturing sector has added an average of 12,125 workers each month since August, mirroring the uptick in demand and production that we have seen since that point. We are hopeful that hiring begins to accelerate again in the coming months.

Looking at the sentiment surveys last week, businesses and consumers were more upbeat. The California Manufacturing Survey from Chapman University reported rising expectations for new orders and production for the second quarter, but with employment growth remaining soft. Both durable and nondurable goods activity were anticipated to expand modestly in the current quarter. Likewise, small business owners in the National Federation of Independent Business’ (NFIB) survey were more optimistic about future sales, and those saying the next three months were a good time to expand edged marginally higher. Still, earnings remained weak, and the percentage suggesting they would bring on more workers moved lower. The University of Michigan and Thomson Reuters also noted improved consumer sentiment, a welcome gain after three months of dampened enthusiasm.

This week will be a busy one on the economic front, specifically with new reports on housing starts and industrial production. We hope to move beyond the weather-related weaknesses from earlier this year, and March’s manufacturing output numbers are expected to show a continued rebound. Similarly, housing starts moved slightly higher in February, but permits surpassed the 1 million mark for the first time since November; yet, rising interest rates, financial challenges for potential buyers and low inventory remain concerns. Other highlights this week include new data on consumer prices, leading indicators, manufacturing surveys from the New York and Philadelphia Federal Reserve Banks and state employment.

Chad Moutray is the chief economist, National Association of Manufacturers. Note that General Electric Chief Economist Marco Annunziata will prepare the Monday Economic Report for April 21.

participation rate - apr2014

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Manufacturing Job Postings and Hiring Data Were Weaker in February

The Bureau of Labor Statistics said that manufacturing job openings declined for the third month in a row in February. After peaking at 298,000 in November, the number of job postings in the sector has continued to move lower, with 250,000 openings recorded in February. Weather has negatively impacted overall economic activity over much of this period, and it is possible that winter conditions hampered employment growth, as well. Nonetheless, this is a trend that will hopefully reverse with coming data, and it reverses what had been upward movement from May to November of last year (up from 203,000 to 298,000).

Net hiring has followed a similar pattern and was also lower in February for the third straight month. Manufacturers added 234,000 workers in February, down from 244,000 in January. At the same time, the number of separations – including layoffs, quits, and retirements – fell from 242,000 to 236,000 for the month. As such, net hiring (or hires minus separations) shifted from a net gain of 2,000 in January to a net loss of 2,000 in February. This was well below the net hiring rate of 41,000 observed in November, illustrating the current softness in the labor market.

In contrast, employment numbers in the larger economy improved in February. Total job openings increased from 3,874,000 in January to 4,173,000 in February. This was the fastest pace for job postings since January 2008. Likewise, net hiring in the month in the nonfarm business sector rose from a rather weak 97,000 in January to 203,000 in February. While manufacturers hired fewer workers in the month, there were notable increases for retail trade, leisure and hospitality, and government.

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

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Monday Economic Report – February 18, 2014

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

A perfectly timed winter storm at the end of last week coincided with news that cold weather has had a negative impact on consumer spending and manufacturing output. Manufacturing production declined 0.8 percent in January, ending five straight months of expanding activity. Poor weather conditions closed some facilities and hampered shipments. Capacity utilization also decreased, down from 76.7 percent in December to 76.0 percent in January. That was the lowest utilization level since July. Yet, to the extent that weather contributed to the fall in manufacturing output, I would expect production to rebound in the coming months. After all, manufacturing production increased 3.0 percent in the second half of 2013, and manufacturers continue to be mostly upbeat about demand for 2014.

Nonetheless, we saw the effects of the weather in other indicators released last week as well. Retail sales fell 0.4 percent in January, extending December’s 0.1 percent decline. Reduced auto sales were a major factor in this decrease, with motor vehicle purchases down 1.8 percent in December and 2.1 percent in January. If you exclude autos from the analysis, retail spending was unchanged.

Although the University of Michigan and Thomson Reuters consumer sentiment measure was unchanged in February, respondents’ view of the current economy has slipped since December. One might surmise that weather impacted labor markets and incomes, lessening current confidence. However, Americans seem more optimistic about the future, with the expectations component rising from 71.2 in January to 73.0 in February.

There were signs that the U.S. economy’s recent improvements continue to bear fruit. Small business leaders have become more confident, with the National Federation of Independent Business’s Small Business Optimism Index edging higher for the third straight month, and January’s data also show an increased willingness to add workers. The net percentage planning to hire in the next three months rose to its highest level since September 2007. Along those lines, the number of manufacturing job postings increased from 283,000 in November to 297,000 in December. We have seen job openings in the sector recover from weaknesses midyear in 2013. Nonetheless, manufacturing net hires eased in December, and there was notable softness in the larger economy, both for new hires and job openings.

This week, we will get new numbers for the housing market and the latest data on manufacturing activity from a number of sources, including surveys from the New York and Philadelphia Federal Reserve Banks and Markit. The latter will report Flash Purchasing Managers’ Index (PMI) findings for the United States, China and the Eurozone. We will be looking for further evidence on the impact weather has had for manufacturers in the United States and for signs of improvement overseas. The Chinese PMI data had contracted in January’s report, but with output continuing to grow modestly. (For more information on worldwide trends, see the Global Manufacturing Economic Update, which was released on Friday.) Other highlights for the week include the latest data on consumer and producer prices, leading indicators and existing home sales.

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

retail sales - feb2014

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Job Openings in Manufacturing Increased in December, but Net Hiring Eased

The Bureau of Labor Statistics said that the number of manufacturing job openings increased from 283,000 in November to 297,000 in December. This was the second-highest level of 2013 (below the 302,000 observed in October), and we have seen the job postings move upward since bottoming out at 210,000 in June. As such, manufacturing job openings have recovered from weaknesses seen earlier in the year, providing us with some hope that additional hiring might occur in the months ahead.

With that said, net hiring eased from the month before. Manufacturers hired 260,000 additional workers in December, down slightly from 256,000 in November. This was the second-highest pace in the past 18 months, suggesting that November’s increase was mostly sustained. Yet, the number of separations in the sector – including layoffs, quits, and retirements – also rose, up from 229,000 to 240,000. As such, net hiring (or hires minus separations) declined from 31,000 to 16,000. This suggests that employment growth in the manufacturing sector has decelerated a bit, even as it remained positive overall on net.

In the larger economy, total job openings decreased from 4,033,000 in November to 3,990,000 in December. In addition to manufacturing, there were marginal gains in job postings in the accommodation and food services, construction, professional and business services, and retail trade sectors. Net hiring also fell, down from 251,000 to 67,000.

Overall, these data confirm a bit of what we already knew, corresponding with the disappointing jobs reports that we have received for both December and January. At the same time, job openings in the manufacturing sector have generally moved in the right direction since the summer, which is definitely positive. Likewise, the most recent figures have shown that manufacturers averaged 15,500 additional net hires each month from August to January, indicating the pickup in demand and production seen since the beginning of the third quarter led to more hiring for the sector.

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

jolts

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Manufacturing Hiring Picked Up in November, but Number of Job Postings Eased a Bit

The Bureau of Labor Statistics said that the number of hires in the manufacturing sector rose from 226,000 in October to 259,000 in November. This was the fastest pace of new hires in over two years. At the same time, separations in the sector – which include layoffs, quits, and retirements – were also somewhat greater, up from 210,000 to 234,000.

As a result, net hiring (or hires minus separations) rose from 16,000 to 25,000. This suggests that net hiring continues to pick up, with definite improvement from July’s data that showed more separations than hires. Indeed, the 25,000 net hiring rate in November was that figure has been since March 2012. This progress mirrors similar employment data that have already been released showing an average of 16,000 net new workers added in manufacturing from August to December.

Meanwhile, the number of manufacturing job openings eased a bit for the month, down from 302,000 in October to 297,000 in November. Despite the pullback, job postings appear to have recovered from recent weaknesses. As recently as June, there were only 210,000 job openings in the sector, and October’s pace had been the fastest since March 2012. Therefore, the November figure sustains much of that growth. This will hopefully lead to additional hiring in the months ahead.

In the larger economy, total job openings increased from 3,931,000 in October to 4,001,000 in November. This was the first time since March 2008 that job postings in the overall economy exceeded 4 million. Sectors with more job openings for the month included accommodation and food services, construction, education and health care, government, and trade, transportation and utilities.

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

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Manufacturing Job Openings Rose to Highest Level in 16 Months in October

The Bureau of Labor Statistics said that the number of manufacturing job openings rose to their highest level in 16 months. Job postings from manufacturers increased from 256,000 in September to 281,000 in October. This was the fastest pace since June 2012. The job openings rate in October was 2.3 percent of total manufacturing employment, up from 2.1 percent in September and a definite improvement from the 1.7 percent pace observed in June.

At the same time, the hiring data were somewhat mixed. The number of manufacturing hires fell from 251,000 in September to 235,000 in October. Separations in the sector – which include layoffs, quits, and retirements – were also lower, down from 246,000 to 214,000.

Despite the reduced rates for hires and separations, net hiring (or hires minus separations) rose for the month from 5,000 in September to 21,000 in October. As such, this was the most net new hires in the manufacturing sector since March 2012. Indeed, the latest overall jobs numbers have also reflected this pickup in employment growth.

In the larger economy, total job openings increased from 3,883,000 in September to 3,925,000 in October. In addition to gains in manufacturing, other sectors with more job postings for the month included construction, leisure and hospitality, professional and business services, and state and local government. Meanwhile, net hiring nationally jumped from 155,000 to 260,000. Some of the sectors with additional workers hired in October were construction, government, leisure and hospitality, and retail trade.

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

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Manufacturing Hiring Edged Up a Bit in September, but Employment Growth Remained Quite Soft

The Bureau of Labor Statistics reported that net hiring in the manufacturing sector edged up a bit in September, but employment growth remains quite soft. The number of new manufacturing hires rose has improved from 222,000 in July to 256,000 in September. Over the same time frame, separations in the sector – which include layoffs, quits, and retirements – have increased from 238,000 to 249,000. As such, net hiring (or hires minus separations) has shifted from a decline of 16,000 workers in July to a gain of 7,000 new employees in September. While this is a definite improvement, it suggests very modest job gains overall, with a continuing hesitance within the sector to hire new workers.

Indeed, the number of job postings from manufacturers declined somewhat from 268,000 in August to 252,000 in September. This was still better than the 210,000 and 234,000 job openings recorded in June and July, respectively. The job postings rate in September was 2.1 percent of total manufacturing employment, down from 2.2 percent in August but up from 1.7 percent in June.

The longer-term trend with job openings is also instructive. Between January 2010 and March 2012, manufacturing job postings rose from 145,000 to 324,000. This was when manufacturers were making outsized gains to employment and growth, with the sector rebounding from a very severe recession. Since March 2012, however, prospective hiring has shifted lower, bottoming out at 210,000 in June, as noted above. For net hiring to improve dramatically, we would need to see job openings start to pick up significantly.

In the larger economy, total job openings expanded from 3,844,000 in August to 3,913,000 in September, boosted by growth in accommodation and food services, construction, professional and business services, and retail trade. At the same time, net hiring was up marginally from 154,000 in August to 159,000 in September. Hiring was mixed overall, with increases in leisure and hospitality, manufacturing, and professional and business services counterbalanced by declines in government, retail trade, and education and health services. Overall, though, the data were little changed from the previous month.

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

jolts

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Manufacturing Job Postings Picked Up in August, But Net Hiring Remained Soft

The Bureau of Labor Statistics reported that manufacturing job postings picked up in August, after slowing down for much of the mid-year. Job openings in the sector has risen from 210,000 in June to 234,000 in July to 272,000 in August, the highest level of postings since February. What’s more, the postings rate in August represented 2.2 percent of total manufacturing employment, up from 1.7 percent and 1.9 percent, respectively, in June and July.

Breaking this down a little more, the job openings improvements in August stemmed mostly from gains in postings from the durable goods sector. Durable goods postings increased from 156,000 to 182,000 for the month (non-seasonally adjusted data). In contrast, nondurable goods job openings declined from 101,000 to 94,000.

The overall improvement in job openings could indicate an uptick of new employment down the line, but for the time being, net hiring remained soft in August. Manufacturers added 231,000 workers in August, up from 222,000 in July. At the same time, there were 229,000 separations in August, down from 238,000 in July. This suggests that net hiring shifting from losing 16,000 workers in the sector in July to adding 2,000 employees in August.

While positive employment growth on net was definitely good news, it is hard to get too excited about such paltry net job gains. Through the first seven months of 2013, the average monthly net job change in manufacturing was -2,125, well below the 16,583 and 12,750 additional workers hired each month on average in 2011 and 2012, respectively.

In the larger economy, total job openings increased from 3,808,000 in July to 3,883,000 in August, boosted by growth in construction, manufacturing, retail sales, health care, and professional and business services. Net hiring slowed, however, down from 224,000 in July to 112,000 in August. Hiring was lower for construction, professional and business services, leisure and hospitality, and government.

jolts

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Net Hiring for Manufacturers Was Zero in July, Number of Job Postings Pick Up but Remain Subpar

The Bureau of Labors Statistics reported that net hiring in July in the manufacturing was zero, according to the latest Job Openings and Labor Turnover Survey (JOLTS) report. In other words, the number of hires equaled the number of separations for the month. Both figures had increased, with hiring up from 225,000 in June to 234,000 in July and separations up from 224,000 to 234,000.  Overall hiring has stalled for the past 12 months, with the average over that time for net hiring being nearly unchanged. This compares to 22 net new workers added on average each month from January to July 2012.  Over the past year-and-a-half, the peak hiring occurred in June 2012 with 283,000 new hires added that month. Clearly, manufacturers have become more skittish on hiring since then.

Meanwhile, manufacturing job postings recovered their losses of June. The number of job openings in the sector rose from 210,000 in June to 237,000 in July, the level experienced in May. Despite the increase, postings from manufacturers remain subpar, down significantly from its recent high of 324,000 in March 2012. In addition, the year-to-date average so far in 2013 was 246,000.

In the larger economy, the dynamic employment data were mixed. The country added 4,419,000 workers in July, up from 4,318,000 in June. Even with the increase, both figures represented 3.2 percent of the total workforce. Monthly gains in employment in the retail trade, professional business services, and healthcare sectors helped to offset declines in leisure and hospitality and essentially flat hiring in construction.

At the same time, though, the number of job postings fell from 3,869,000 in June to 3,689,000 in July, a decline from 2.8 percent to 2.6 percent of the workforce. These losses were largely across-the-board. In essence, the decline wiped out the increases experienced between February and June. The average over those five months was 3,870,000, illustrating the substantive decline in July. The number of job openings in July was more comparable to January’s figure of 3,611,000.

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

jolts

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Manufacturing Job Openings Fell Again in June

The Bureau of Labor Statistics said that job openings in manufacturing fell from 237,000 in May to 215,000 in June, according to the Job Openings and Labor Turnover Survey (JOLTS). That was the fewest number of job postings in the sector in two years, and it represented a continuation of the decline in openings from the recent high of 310,000 in June 2012, one year ago. The percentage of job openings as a percentage of total employment in the sector, or the job openings rate, has decreased from 2.5 percent to 1.8 percent over the course of the past 12 months. This backs up other data showing a hesitance to bring on new workers right now.

As further evidence of this, net hiring has been negative for four straight months, with the number of hires lower than separations over that time. (The JOLTS data have a time lag, and we learned last week that manufacturers added 6,000 workers in July, with 9,100 of those coming from the automotive sector.)

In June, manufacturers hired 225,000 workers, down from 239,000 in May. This was still an improvement from March’s 201,000 hires, the recent low point. At the same time, manufacturing separations — including layoffs, quits, and retirements — declined from 249,000 to 229,000. This implies net hiring of -4,000 for the month, or slightly better than the -10,000 observed in May.

Meanwhile, the story was somewhat different in the larger economy. The number of job openings rose somewhat from 3,907,000 in May to 3,936,000 in June. Despite the higher number, the job openings rate remained the same at 2.8 percent, essentially where it has been for much of the past year. Sectors with more job openings in June included accommodation and food services, construction, professional and business services, and retail trade. Moreover, net hiring grew from 109,000 in May to 120,000 in June.

Overall, jobs growth remains modest at best in the macroeconomy, but for manufacturers, the reduction in job openings and hiring illustrate a hesitance to add new workers at the current time. It will be important moving forward to get manufacturers flourishing again, which should allow for improvements in hiring.

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


A Manufacturing Blog

  • Categories

  • Connect With Manufacturers

            
  • Blogroll