Survey: US August factory activity at 6-plus year high

Survey: US August factory activity at 6-plus year high

Sep 6, 2017

By Marcy Gordon, AP Business Writer, ABC News U.S. factories expanded at a brisk pace in August, a likely sign of strength for the U.S. economy as new orders, production and employment all improved. The Institute for Supply Management said Friday that its manufacturing index rose to 58.8 percent last month from 56.3 percent in July. Anything above 50 signals that factory activity is increasing. The measure now stands at its highest level since April 2011, pointing to solid economic growth. Fourteen of eighteen manufacturing industries surveyed by ISM posted growth in August, including the machinery, petroleum and coal products, and computer and electronic products sectors. August was “a really strong month,” Timothy Fiore, chair of ISM’s manufacturing business survey committee, said in a telephone interview. He noted that the growth was mostly driven by the top manufacturing sectors. It’s early to predict the impact on the oil, gas and chemical industries and on the broader economy of Hurricane Harvey. But Fiore said a snap survey of ISM members showed there likely will be a significant hit to the petroleum and chemical products sectors and “lots of supply chain disruptions.” Refining capacity, raw materials and the ability to deliver products all have been drastically affected by the storm that lashed Houston and nearby areas and shut down oil refineries, plastics plants and the Houston port — the second-busiest in the nation. There have been widespread reports of gasoline shortages. The chemical products sector is one of the six biggest manufacturing industries, accounting for 17 percent of total activity, Fiore noted. Petroleum and coal, also among the “Big Six,” account for 7 percent. Texas represents more than 10 percent of U.S. manufacturing production. Chemical products refining in the state accounts for 20 percent of the U.S. total, and oil and gas represents 30 percent. U.S. factories have largely recovered from a slump in late 2015 and early 2016 caused by cutbacks in the energy industry and a strong dollar, which makes U.S. goods more expensive in foreign markets. Manufacturing employment began a sustained turnaround in December and enjoyed four additional months of job gains, only to have factories shed 1,000 workers in May. New government data issued Friday...

After decades of pushing bachelor’s degrees, U.S. needs more…

After decades of pushing bachelor’s degrees, U.S. needs more…

Aug 30, 2017

“After decades of pushing bachelor’s degrees, U.S. needs more tradespeople” By Matt Krupnick, The Hechinger Report FONTANA, Calif. — At a steel factory dwarfed by the adjacent Auto Club Speedway, Fernando Esparza is working toward his next promotion. Esparza is a 46-year-old mechanic for Evolution Fresh, a subsidiary of Starbucks that makes juices and smoothies. He’s taking a class in industrial computing taught by a community college at a local manufacturing plant in the hope it will bump up his wages. It’s a pretty safe bet. The skills being taught here are in high demand. That’s in part because so much effort has been put into encouraging high school graduates to go to college for academic degrees rather than for training in industrial and other trades that many fields like his face worker shortages. Now California is spending $6 million on a campaign to revive the reputation of vocational education, and $200 million to improve the delivery of it. “It’s a cultural rebuild,” said Randy Emery, a welding instructor at the College of the Sequoias in California’s Central Valley. Standing in a cavernous teaching lab full of industrial equipment on the college’s Tulare campus, Emery said the decades-long national push for high school graduates to get bachelor’s degrees left vocational programs with an image problem, and the nation’s factories with far fewer skilled workers than needed. “I’m a survivor of that teardown mode of the ’70s and ’80s, that college-for-all thing,” he said. This has had the unintended consequence of helping flatten out or steadily erode the share of students taking vocational courses. In California’s community colleges, for instance, it’s dropped to 28 percent from 31 percent since 2000, contributing to a shortage of trained workers with more than a high school diploma but less than a bachelor’s degree. Research by the state’s 114-campus community college system showed that families and employers alike didn’t know of the existence or value of vocational programs and the certifications they confer, many of which can add tens of thousands of dollars per year to a graduate’s income. “All throughout high school, they made it sound like going to college was our only option.” Derrick Roberson, who is training to...

Survey Suggests More Growth Ahead For Midwest Economy

Survey Suggests More Growth Ahead For Midwest Economy

Aug 1, 2017

By The Associated Press A monthly survey of business leaders suggests that business conditions worsened last month but that the economy will pick up over the next few months in nine Midwestern and Plains states, according to a report issued Tuesday. The Mid-America Business Conditions Index dropped to 56.1 in July after reaching 62.3 in June. The May figure was 55.5. “The overall index over the past several months indicates a healthy regional manufacturing economy, and points to solid growth for both manufacturing and nonmanufacturing for the second half of 2017,” said Creighton University economist Ernie Goss, who oversees the survey. The survey results are compiled into a collection of indexes ranging from zero to 100. Survey organizers say any score above 50 suggests growth in that factor, while a score below that suggests decline. The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota. Economic optimism remained strong despite a decline in July’s number: to 60.2 from 67.5 in June. “Strong profit growth, still-low interest rates, and international sales boosted the economic outlook among supply managers in the nine-state region,” Goss said. The July employment index remained above growth neutral, despite slipping to 56.5 last month from 60.7 in June. “With the recent boost in employment growth, total regional employment growth (year over year) is now 1.4 percent, and slightly below the nation’s 1.6 percent gain over the same time period,” he said. On the trade front, the regional index for new export orders index dipped to 54.3 in July from 56.6 in June, and the import index declined to 50.0 from June’s 56.7. Japan’s recent decision to raise the tariff on frozen beef imports will significantly harm Kansas and Nebraska, according to Goss, because Nebraska ranked No. 1 and Kansas No. 4 in those...

Where Manufacturing Is Thriving In The U.S.

Where Manufacturing Is Thriving In The U.S.

Jun 19, 2017

By Joel Kotkin and Mike Shires, Forbes Throughout the dismal presidential campaign, the plight of America’s manufacturing sector played a central role. Yet despite all the concerns raised about factory jobs leaving the country, all but 18 of the country’s 70 largest metropolitan regions have seen an uptick in industrial employment since 2011. And despite the slowdown in car sales, the job count continues to expand, albeit more slowly. Although the share of industrial jobs has shrunken from 10.5% of all nonfarm employment in 2005 to 8.5% today, manufacturing continues to have an outsized influence on regional economies, as is spelled out in the latest paper from the Center for Opportunity Urbanism. This stems in large part from the industrial sector’s productivity gains since 2001 — almost twice as much as the economy-wide average, according to the Bureau of Labor Statistics — and it has a far higher multiplier effect (the boost it provides to local job and wealth creation) than virtually any other sector. Manufacturing generates $1.40 in economic activity for every dollar put in, according to the U.S. Bureau of Economic Analysis, far greater than the multiplier generated by business services, information, retail trade or finance. To determine the places where manufacturing growth is the strongest, we looked at employment in the sector over time, assessing short-, medium- and long-term trends going back to 2005 and adding in variables for persistence and momentum as well. The results of these trends, based on three-month averages, are normalized and each MSA is assigned a score based on its relative position in each area.  The rankings this year produced some surprising results, as well as some familiar stories. Red States And The Rust Belt Win  Nine of this year’s top 10 regions for manufacturing job growth are in red states, led by top-ranked Louisville-Jefferson County, which straddles the border between Kentucky and Indiana. Since 2011, manufacturing employment in the metropolitan area has expanded 30.2% to a total of 83,300 jobs, led by a resurgent auto industry that accounts for 27,000 jobs in the area. Due to a slowdown in auto sales, the job count may be peaking, but the hub of the Bluegrass State has...

After-Tax U.S. Manufacturing Profits Up 19.9% from Q1 2016…

After-Tax U.S. Manufacturing Profits Up 19.9% from Q1 2016…

Jun 6, 2017

“After-Tax U.S. Manufacturing Profits Up 19.9% from Q1 2016 to Q1 2017” By Terence P. Jeffrey, CNSNews.com The after-tax profits of U.S. manufacturing corporations increased from $118,199,000,000 in the first quarter of 2016 to $141,672,000,000 in the first quarter of 2017, an increase of $23,473,000,000 of about 19.9 percent, according to data released today by the Census Bureau. According to the Census Bureau, this data only counts the after-tax profits on manufacturing done within the United States. It does not count the after-tax profits that a U.S.-based manufacturing corporation may earn from products it makes in foreign countries. After-tax profits of U.S. manufacturing also increased from $131,727,000,000 in the fourth quarter of 2016 to the $141,672,000,000 reported for the first quarter of this year—a climb of $9,945,000,000 or about 7.5 percent from one quarter to the next. “U.S. manufacturing corporations’ first quarter 2017 unadjusted after-tax profits totaled $141.7 billion, up $23.5 billion from the after-tax profits in the first quarter of 2016, and up $9.9 billion from the after-tax profits of $131.7 billion recorded in the fourth quarter of 2016,” the Census Bureau said in the press release for its Quarterly Financial Report on U.S. manufacturing, mining, wholesale trade and selected service industries. In addition to these “unadjusted” numbers, the Census Bureau also publishes “seasonally adjusted” numbers for quarterly manufacturing profits. In the seasonally adjusted numbers, after-tax profits for manufacturing corporations in the first quarter this year were up $24 billion from the first quarter last year, and up $3.5 billion from the fourth quarter of last year. “U.S. manufacturing corporations’ seasonally adjusted after-tax profits in the first quarter of 2017 totaled $146.5 billion, up $3.5 billion from the after-tax profits of $142.9 billion in the fourth quarter of 2016, and up $24.0 billion from the after-tax profits of $122.45 billion recorded in the first quarter of 2016.” Actual sales for U.S. manufacturing corporations were up $94.2 billion from the first quarter of last year, according to the Census—rising from $$1,4881.8 billion in the first quarter of 2016 to $1576.0 billion in the first quarter of 2017....