“Eliminate the Trade Deficit” Resonates in Halls of Congress

“Eliminate the Trade Deficit” Resonates in Halls of Congress

Mar 22, 2017

By Michele Nash-Hoff, Savingusmanufacturing.com  “You were ahead of the curve on trade.” This was the common refrain heard last week by members of the Coalition for a Prosperous America who attended our annual fly-in to Washington, D. C. We had eight teams of members visiting Congressional Representatives and Senators on March 14th and 15th. As Chair of our developing California chapter, it was my fifth year attending the CPA fly-in, and our simple message of eliminating the trade deficit resonated well in the halls of Congress. No one could deny that we have a huge deficit as shown on the chart below: The annual trade deficit has reduced our U. S. GDP by some 3% to 5.5% each year, and those reductions compound over time. There is no historical record of any other country in history running 41 years of consecutive trade deficits. Why is this important? Because every billion dollars of net imports costs 4,500 American jobs according to conservative estimates. So last year’s $502 billion deficit equates to 2.25 million jobs lost. As a result, our Labor Force Participation is in serious decline. The U. S. is the only G7 nation with a DECLINE in LFPR since 1998 for workers ages 15-64. It peaked at 77.4% in 1998 and dropped down five points to 72.6% in 2015, meaning that over 7 million people dropped out of labor force since 1998. The remedy recommended by the Coalition for a Prosperous America is simple:  Congress should establish a national goal to eliminate the trade deficit. Balanced trade over time is the goal of free trade and of fair trade. Balanced trade will re-industrialize our country, enable massive job creation, grow our wealth and effectively neutralize foreign mercantilism. Trade policy must address true drivers of deficit, these countries and their practices. Many of these countries have export-oriented growth strategies in which they rely upon the US market to consume their exports rather than increasing their internal consumption. China, Germany, Japan and other countries pursue net exports through strategic mercantilism, not free trade. Currency manipulation, value added taxes, state influenced enterprises, and other tactics are used. The following top 10 countries account for 90% of America’s...

How ‘Made in the USA’ can see a renaissance, and…

How ‘Made in the USA’ can see a renaissance, and…

Mar 6, 2017

“How ‘Made in the USA’ can see a renaissance, and what will (and won’t) change” By Trent Gillies, CNBC President Donald Trump has promised to bring jobs back to America, but the number of U.S. manufacturing jobs has been on a 30-year decline. Can that entrenched trend be reversed? A growing number of market experts believe the answer is yes. “I’m very optimistic,” small businessman Drew Greenblatt told CNBC’s “On The Money” in an interview. “We’re going to see an American manufacturing renaissance” Greenblatt, chair of the National Association of Manufacturers and president of Baltimore-based Marlin Steel Wire Products, pointed to policies that Trump wants to enact as a potential catalyst to new hiring. “We’re talking about reducing regulations by 75 percent, cutting our tax rate from 40-something percent to 15 percent,” he said. “It’s just going to make America more attractive to bring back opportunities to our country,” he added. However, in industries such as apparel, more than 97 percent of clothing and shoes are made overseas. Given the entrenched economic realities, others are skeptical that any government policy can spark a manufacturing rebound “There’s not much that can bring most of those jobs back, ” retail consultant Jan Kniffen told CNBC in an interview. “We haven’t made patterns in America, we haven’t made the product in America forever,” he said.   Kniffen added that the U.S. “would need factories, but those factories would have to be so automated, the jobs would be maintaining the equipment not producing the product.” That is because “the cost of producing abroad is so low and shipping not that much,” he said. Greenblatt remained optimistic that at least some sectors could see a resurgence. ” I acknowledge some industries are not coming back here, it makes more sense to do it elsewhere. But things like making airplanes and bulldozers and cars, it’s going to grow here, it’s going to thrive here.” Greenblatt’s Marlin Steel exports to 39 countries from its Maryland factory. He told CNBC that the company designs and fabricates wire baskets for automotive clients including Toyota Motor and General Motors. “We make baskets for Caterpillar and Boeing,” he said. “These companies are building factories in...

US manufacturing surges to a 3-year high in February

US manufacturing surges to a 3-year high in February

Mar 1, 2017

By Akin Oyedele, Business Insider US manufacturing expanded more than expected in February, according to the Institute of Supply Management.  The monthly purchasing manager’s index jumped to 57.7, the highest since December 2014 and more than economists’ forecast for 56.2.  According to ISM, orders rose at the fastest pace since February 2013.  Earlier regional manufacturing surveys, including those from Philadelphia and New York, had also pointed to an overall improvement in the sector. “Growth is being driven by robust domestic demand, stemming in turn from buoyant consumers and increased investment spending by the energy sector in particular,” said Chris Williamson, the chief business economist at IHS Markit.  Markit Economics’ monthly PMI was 54.2, lower than economists’ forecast for 54.5 according to Bloomberg.  “Manufacturing is far from booming, however, as the strong dollar means near-stagnant exports continue to act as a drag on growth,” he added....

Machine Tool Orders Surge in December

Machine Tool Orders Surge in December

Feb 13, 2017

By Bill Koenig, Advanced Manufacturing Machine tool orders surged 20.6% in December as manufacturing “is showing signs of growth,” the Association for Manufacturing Technology said today in a monthly report. Orders totaled $406.72 million, up from a revised $337.24 million in November, according to AMT (McLean, VA).  The December figure was just under the $406.95 million in December 2015. “There has been a significant uptick in shipments for cutting tools,” Douglas K. Woods, AMT’s president, said in a statement. “Gains for machine shop investment are promising because they typically mark an overall greater need for capacity, and a broader upturn on the horizon.” For all of 2016, machine tool orders fell 4% to $4.01 billion, AMT said. The gap between 2016 and 2015 orders narrowed significantly during the second half of last year. Orders for the first six months of the year plunged 16% compared with 2015’s first half. One factor in the second-half improvement was IMTS 2016, the massive trade show organized by AMT and held in Chicago. The figures are based on information from companies participating in AMT’s US Manufacturing Technology Orders program. Industry Recovery The group has said it expects a sustained recovery in machine tool orders in April or May. Other economic reports related to manufacturing have shown improvement. The Institute for Supply Management said Feb. 1 that its PMI, which measures economic activity in manufacturing, was 56% in January. That was the highest level for the index in more than two years. The PMI is  based on a survey of purchasing and supply executives in 18 industries....

US Manufacturing sector starts on a firm footing in 2017

US Manufacturing sector starts on a firm footing in 2017

Feb 8, 2017

By Orbex Team, FXStreet Two separate gauges of the US manufacturing sector confirmed that the sector kicked off 2017 on a firm footing evidenced by acceleration in new orders and output growth. Factory output in the US was choppy over the past few years with one of the manufacturing gauges, the ISM manufacturing PMI falling into a contraction around late 2015 – early 2016. Manufacturers were squeezed by a stronger dollar which curtailed demand for the US made products. Manufacturing was, however, seen stabilizing by mid-2016.   New order growth accelerates to a 28-month high The report released last week by IHS Markit suggested that improving business conditions alongside sustained low unemployment helped to boost the manufacturing sector. IHS Markit’s manufacturing PMI rose to 55.0 in January, from 54.3 in December. However, the January’s headline print was slightly off from the flash estimates which showed a reading of 55.1. Still, a reading above 50 indicates expansion in the manufacturing sector and Markit’s gauge of manufacturing PMI continued to rise steadily. Markit – Manufacturing PMI, U.S. The IHS Markit’s data showed a renewed acceleration in output growth among the manufacturing firms that were surveyed. The rate of expansion rose to the strongest level in 22-months with respondents noting that production volumes had increased with client demand improving. This is expected to boost inventory levels at the start of the year. The report highlighted the optimism among businesses for the year ahead. Chris Williamson from Markit said, “Production is consequently growing at the strongest rate for almost two years, and inventories are rising at a rate not seen for nearly a decade as firms respond to higher demand, suggesting the goods-producing sector will make a decent contribution to first quarter GDP.”   US ISM Manufacturing jumps to a 2-year high The Institute of Supply Management’s (ISM) gauge of manufacturing also showed similar trends. The survey report showed that factory activity in the US accelerated to the fastest pace in more than two years. The ISM manufacturing PMI rose to 56.0 in January up from 54.5 in December. ISM Manufacturing PMI, January 2017 Some analysts believe that the gains in the manufacturing sector came partly on account of increased optimism...