Category: Blog

ECONOMIC NEWS

Posted February 6, 2012 by Sonja Marshall

Economy Created 243,000 Jobs In January; Unemployment Drops To 8.3 Percent.

The CBS Evening News (2/3, lead story, 3:45, Pelley) reported on “a big improvement in the unemployment picture. The Labor Department reported today that the jobless rate in January fell 0.2% to 8.3%, the lowest in three years. And the economy created 243,000 jobs. That’s a lot more than economists or Wall Street were expecting.”

NBC Nightly News (2/3, story 2, 2:20, Holt) reported, “The jobs report for January out this morning blew past everyone’s expectations. … Wall Street responded with a surge of its own, the Dow up 156 points to its highest close since May 2008 before the economic meltdown, and Nasdaq hit an 11-year high.”

The AP (2/3) reported, “In the most impressive surge for the job market since early last year, the United States added 243,000 jobs in January, far more than economists expected. … Hiring accelerated across the economy and up and down the pay scale. The high-salary professional services industry added 70,000 jobs, the most in 10 months. Manufacturing added 50,000, the most in a year.”

Bloomberg News (2/4, Willis, Miller) reported that the “labor market recovery is broadening as industries from construction to retail to manufacturing added workers in January.”

The New York Times (2/4, Rich, Subscription Publication) reported, “Measured by both the unemployment rate and the number of jobless — which fell to 12.8 million — it was the strongest signal yet that an economic recovery was spreading to the jobs market.”

The Washington Post (2/4, Whoriskey) reported the President “seized on the numbers as proof that the nation’s economic recovery ‘is speeding up.'”

The Wall Street Journal (2/4, Dougherty, Subscription Publication) reported job growth was at its fastest rate since April 2011, and unemployment was down for the fifth consecutive month.

The Los Angeles Times (2/4, Lee) reported, “Some economists called the latest employment report a game-changer that signaled better times ahead for American workers,” but “many others were cautious in their assessment, noting that job growth was inflated by the unseasonably warm weather — construction reported sizable gains, for instance — and that the outlook remains constrained by government budget cuts, financially strapped consumers and a slowing global economy.”

From SME Daily Executive Briefing 2/6/2012

US Manufacturing Activity Grew In January.

Posted February 2, 2012 by Sonja Marshall

The Milwaukee Journal Sentinel (2/2, Barrett) reports, “Boosted by an increase in new orders, the production at US factories grew in January at the fastest pace in seven months.”

Bloomberg News (2/2) reports, “The Institute for Supply Management’s index climbed to 54.1, from 53.1 in December, the Tempe, Arizona-based group’s report showed” Wednesday. “The ISM’s new orders measure climbed to 57.6, the highest since April, from 54.8, and the gauge of export orders rose.” Bloomberg News notes, “Manufacturing accounts for about 12 percent of the economy and was at the forefront of the recovery that began in June 2009.”

The AP (2/2, Rugaber) reports, “Consumers are buying more cars and trucks, while businesses ordered more machinery and other equipment. That has driven manufacturing, which expanded for the 30th straight month.”

The Hill (2/1, Needham) “On The Money” blog reported, “Export orders also rose, a sign that US manufacturers haven’t yet been affected by Europe’s slowing economy. Meanwhile, a separate report from the Commerce Department showed that construction spending increased 1.5 percent in December, the fifth straight monthly gain. That pushed spending to a seasonally adjusted annual rate of $816.4 billion, the highest level in 20 months.”

Also covering the story are Reuters (2/2, Schnurr), MarketWatch (2/2, Bartash), AFP (2/2), IndustryWeek (2/2) and other media sources.

Manufacturing Growth In Canada Slows Sharply In January. Canada’s Financial Post (2/2) reports, “Canadian manufacturing growth slowed markedly in January, data contained in the Canadian Manufacturing Purchasing Managers Index showed” yesterday. “‘The headline RBC PMI – a composite indicator designed to provide a single-figure snapshot of the health of the manufacturing sector – registered 50.6 in January, down sharply from 54.0 in December, and indicated the weakest improvement in Canadian manufacturing business conditions since data collection began in October 2010,’ said the report, compiled in association with financial services company Markit.” The Post reports, “While the survey found that manufacturing conditions did improve in January, rates of expansion in output and new order growth were the weakest since data collection began.”

Reuters (2/2, Cook), Dow Jones Newswires (2/2, Menon, Subscription Publication) and other media sources also cover the story.

From SME Daily Executive Briefing 2/2/2012

First Report: World of Concrete 2012

Posted February 1, 2012 by Sonja Marshall

Annual concrete extravaganza generates good numbers and strong expectations.

Official attendance numbers have not been released yet for World of Concrete 2012, which ends its run today in Las Vegas, but initial estimates of both show promoters and exhibitors peg attendee figures at up to 50,000. More important than the base numbers however, were the uniform reports from exhibitors of stronger business activity at the show, with more orders being written this year and a much more confident mood heading into the 2012 construction cycle.

Read full article by clicking HERE.

FABTECH 2011 Breaks Records and Exceeds Expectations

Posted January 20, 2012 by Sonja Marshall

FABTECH 2011 Breaks Records and Exceeds Expectations

Thank you for being an integral part of FABTECH 2011. The 2011 event culminated with a total of 1,360 exhibiting companies covering an astounding 523,740 net square feet of floor space. Your presence helped draw over 35,000 attendees to the Chicago event at McCormick Place, making this the largest FABTECH to date!

More importantly than the record high levels of space and attendance is the fact that FABTECH continues to contribute toward your company’s success. Repeatedly, exhibitors invest in FABTECH to generate sales leads and 2011 was no different. In fact, 29% of exhibitors reported FABTECH exceeded their lead generation expectations. Beyond lead generation, FABTECH exceeded expectations in image building, being able to demonstrate new technology and as a platform for new product launches. As Show Management, we are proud to be THE authoritative event for the leaders in forming, fabricating, welding and finishing technology.

FABTECH is a Key Industry Resource
According to our show attendees, 57% reported in post show surveys that FABTECH exceeded their expectations as an overall event. They came to see and evaluate new products / technologies and were very pleased, with over 35% being exceedingly satisfied. Seeing equipment in action is always another primary reason buyers annually visit FABTECH. In 2011, exhibitors demonstrated thousands of products with nearly 41% of attendees saying their expectations were exceeded. When buyers think about new technology, FABTECH is the place they come to see the latest and greatest available to the world.

Complete show results can be found in the FABTECH 2011 Post Show Report

Audience Facts:

52% were first time attendees and 61% attend no other show
29% had job titles of corporate executive/top-level management or job shop owner
11% of attendees came from outside the U.S.
82% of visitors are involved in some way in their company’s purchasing plans
44% indicated budgets of $200,000 or more to spend on products and services
52% of attendees plan to make a purchase in the next 6-9 months

Join Us in Las Vegas

The momentum of FABTECH continues as the show heads to Las Vegas, November 12-14, 2012 in the Central and North Halls of the Las Vegas Convention Center. The 2008 Las Vegas show proved to be an outstanding opportunity to reach the western manufacturing market and this year will be no exception. The Las Vegas venue also attracts a large number of buyers from the Midwest, Western Canada and internationally. If you have not booked your space already, be sure to contact a sales representative below to see what is available .

Fabricating/Tube & Pipe Exhibitors (A-L)
Michael Scott, FMA
(800) 432-2832 ext. 271
michales@fmafabtech.com

Fabricating/Tube & Pipe Exhibitors (M-Z)
Cara Collins, SME
(800) 733-3976 ext. 3126
ccollins@sme.org

Welding Exhibitors
Joe Krall, AWS
(800) 443-9353 ext. 297
jkrall@aws.org

Metalform Exhibitors
Roger Judson, PMA
(216) 901-8800 ext. 2155
rjudson@pma.org

Finishing Exhibitors
Andy Goyer, CCAI
(941) 373-1830
andy@goyermgt.com

US Factories Expanded At Fastest Pace In Six Months In December.

Posted January 4, 2012 by Sonja Marshall

Bloomberg News (1/4, Willis) reports, “US factories expanded in December at the fastest pace in six months, adding to evidence manufacturing is improving from India to the UK entering 2012. The Institute for Supply Management’s factory index climbed to 53.9 last month from 52.7 in November,” ISM’s data showed.

BBC News (1/4) reports, “It was the 29th month in a row that the sector has grown and the latest in a run of positive indicators from the US.”

The AP (1/4, Rugaber) reports, “In the US, factories hired more workers in December, saw the most growth in new orders since April and ramped up production.”

On its website, CNBC (1/4, Domm) reports, “The employment component rose to 55.1 from 51.8 in November, the highest since June. ‘Manufacturing might be a kind of small part of the employment picture, but it’s consistent with some of the other indicators which should show it (December employment) to be a good report,'” J.P. Morgan economist Michael Feroli.

The Minneapolis Star Tribune (1/4, Buchta) reports Bradley Holcomb, chairman of the ISM’s survey committee, “said that with new orders up and prices of raw materials down, ‘manufacturing is finishing out the year on a positive note.'”

CNNMoney (1/4, Isidore) reports, “The ISM survey also found new orders and the backlog of orders growing from November levels. Both are relatively recent turnarounds compared to the longer-term growth in the overall reading.” However, some “economists said it’s important not to read to much into the end of the year strength. Some of it may have been from businesses scrambling to make big ticket purchases before losing a tax break at the end of the year to write off the cost of that investment more quickly.”

Also covering the story are the Wall Street Journal (1/4, Mitchell, Linebaugh, Subscription Publication), Reuters (1/4, Johnson) and other media sources.

Manufacturing Conditions In Canada Improve In December. Canada’s Postmedia News (1/4, Morrissy) reports, “Manufacturing conditions improved in December as production and new orders both rose strongly, RBC’s monthly Purchasing Managers Index showed Tuesday. The composite indicator, intended to provide an early indicator of trends in the manufacturing sector and conducted in association with financial information services company Markit, posted a reading of 54 in December, up from 53.3 in November.” Paul Ferley, assistant chief economist at RBC Economics said, “The RBC PMI indicates that Canadian manufacturing activity not only continues to expand but also that the pace of activity strengthened relative to slowing growth in both November and October. This bounce back in part reflects increased foreign demand despite indications of the eurozone likely falling into recession and still modest growth in the US.”

Reuters (1/4, Sibonney) also covers the story.

From SME Daily Executive Briefing 1.4.2012

Heavy Metal Is Back: The Best Cities For Manufacturing

Posted December 30, 2011 by Sonja Marshall

For a generation American manufacturing has been widely seen as a “declining sport.” Yet its demise has been largely overplayed. Despite the many jobs this sector has lost in the past generation, manufacturing remains remarkably resilient, with a global market share similar to that of the 1970s.

More recently, the U.S. industrial base has been on a powerful upswing, with employment climbing steadily since 2009. Boosted by productivity gains and higher costs in competitors, including China, U.S. manufacturing exports have grown at their fastest rate since the late 1980s. In 2011 American manufacturing continued to expand, while Germany, Japan and Brazil all weakened in this vital sector.

To determine the best cities for manufacturing my colleague Mark Schill at Praxis Strategy Group measured the 51 largest regions in the country in terms of how they expanded their “heavy metal” sector — think automobiles, farm and energy equipment, aircraft, metal work and machine shops. We averaged absolute growth rate and momentum in 148 heavy metal manufacturing industries over ten-, five-, two-, and one-year time frames.

Our top ranked area, Houston, is one of only four regions that enjoyed net job growth in manufacturing in the past 10 years. This year its heavy manufacturing sector expanded by almost 5%. Houston’s industrial growth is no fluke; over the past year its overall job growth has been about the best among all the nation’s major metros.

Houston’s industrial success owes much to the city’s massive port and booming energy sector, says Bill Gilmer, senior economist at the Federal Reserve office of Dallas. “Houston is about energy — it’s about fabricated metals and machinery,” he says. “It’s oil service supply and petrochemicals. It’s all paced by a high price of oil and new technology that makes it more accessible.”

This shift towards domestic energy augurs well for a huge and economically beneficial shift in America’s longer term economic prospects, he points out. Cheap natural gas, for example, makes petrochemical production in America more competitive than anyone could have imagined a decade ago. Linkages with Mexico in terms of energy as well as autos has made Texas — which is also home to No. 4 ranked San Antonio and No. 15 ranked Dallas — the nation’s primary export super-power, with current shipment 15% to 20% above pre-crisis levels.

The energy and industry connection also can be seen in No. 10 Oklahoma City, where heavy industry has been booming through much of the recession due to its strong fossil fuel industry. This synergy between energy and manufacturing could also spread to other regions, including many not associated with large fossil fuel deposits New finds in the Utica shale in Ohio, for example, could be worth as much as $500 billion; one energy executive called it “the biggest thing to hit Ohio since the plow.”

These gas finds may help ignite the heavy metal revival. As coal-fired plants become more expensive to operate due to concerns over greenhouse gas emissions, the region will have a new, cleaner and potentially less expensive power source.

Already the boom in natural gas has sparked a considerable industrial rebound in parts of eastern Ohio including the building of a new $650 million steel plant for gas pipes in the Youngstown area. Karen Wright, whose Ariel Corporation sells compressors used in gas plants, has added more than 300 positions in the past two years. “There’s a huge amount of drilling throughout the Midwest,” Wright says. “This is a game changer.”

But the industrial rebound is not only about energy. Another critical factor is rising wages in East Asia, including China. Increasingly, American-based manufacturing is in a favored position as a lower-cost producer. Concerns over “knock offs” and lack of patent protection in China may also spark a growing “Made in the USA” trend.

The shift back to U.S. production may be a great sign for many regions. Our No. 3 ranked area, Seattle-Tacoma-Bellevue, is picking up heavy metal jobs associated with the aerospace industry. A growing focus on domestic production for Boeing’s new aircraft could bring even more prosperity to the high-flying region, which also ranked No. 1 on our recent information industry ranking.

If new industrial growth is just another piece of good news in the Pacific Northwest, it’s manna from heaven to the long suffering industrial heartland heavily concentrated in the Great Lakes region, which includes much of Ohio, Michigan, Indiana, Illinois , Wisconsin and Minnesota. Long reviled as the “rust belt” this area now leads in the industrial rebound with over 100,000 new manufacturing jobs in just the past year.

Particularly well positioned is No. 2 ranked Milwaukee, which is home to a wide array of specialized manufacturing firms ranging from machine tools to energy. Over the past year alone the region added almost 3900 heavy metal jobs and has consistently led other Great Lakes communities in job creation.

But Milwaukee is not the only rust belt rebound town. The greater Detroit area, No. 6 on our list, actually added the most heavy metal jobs — more than 12,000 — than any region of the country. The area’s ranking, however, was dragged down by its legacy; greater Detroit still has lost almost 130,000 positions in the past decade.

The heavy metal revival has a long way to go. And we cannot expect it to produce the same kinds of jobs produced in the last century. For example, the new jobs will be more highly skilled; even as the share of the workforce employed in manufacturing has dropped from 20% to roughly half that, high skilled jobs in industry have soared 37%, according to a New York fed study.

Regions seeking strong industrial growth will have to focus more and more on training more skilled workers. Even after years of declining employment and surplus numbers of graduates in the arts and law, manufacturers in heavy industry are running short on skilled workers. Industry expert David Cole predicts there could be demand for 100,000 new workers by 2013. According to Deloitte Touche, 83% of all manufacturers suffer a moderate or severe shortage of skilled production workers.

The resurgence of heavy metal should lead regions, and the federal government, to consider shifting their emphasis toward productive, skilled based training and away from a single-minded focus on the BA or graduate degree. Few regions suffer a shortage of art history or English graduates. This more practical emphasis is particularly critical for the Midwest, which is home to four of the ten highest-ranked industrial engineering schools in the nation.

Even more important: training workers for the assembly lines of tomorrow. These jobs, notes Ariel’s Karen Wright, will require not BA degrees but high degrees of math and mechanical skills that can be apply to expanding companies like hers.

As we enter a new economic era, regions should look beyond the current obsession with “creative” and “information” industries. Instead, they should focus on a resurgent industrial economy — which then can provide a customer base for advertising, graphics and software companies — as a primary driver of economic growth. Turn down those soulful Adele tracks: Heavy metal is back.

By Joel Kotkin

Leading the News

Posted December 23, 2011 by Sonja Marshall

Unemployment Claims Continue To Fall.

The CBS Evening News (12/22, story 2, 2:05, Pelley) reported that “there are some other encouraging things about the economy” now, including a drop in the number of people filing for unemployment last week, which fell to 364,000, the lowest “since April of 2008.”

According to Bloomberg News (12/22, Homan, Willis), the 45 economists surveyed by Bloomberg had predicted an average “increase in jobless claims to 380,000,” however “the number of applications” has fallen 40,000 in the last three weeks. Chief US economist for High Frequency Economics, Ian Shepherson, said “this is great news,” and while “one unexpectedly low number can easily be a fluke” and “two are interesting,” three may say “something real is happening in the labor market.” Further, there was a decline of 79,000 in the number of “people continuing to receive jobless benefits,” now down to 3.55 million, the lowest level since September 2008.

According to the AP (12/22, Wagner, Crutsinger), “the steady improvement in the job market is unquestionable,” and BMO Capital Markets senior economist Jennifer Lee says “I think everyone is starting to come around to the view that, yes, there is a recovery going on.” Further, minus “a spike this spring” following damage to “US manufacturing” after the earthquake and tsunami in Japan, “unemployment claims” have been declining “steadily for a year and a half” after peaking “at 659,000 in March 2009.” In the four years prior to “the Great Recession,” the numbers were usually between 300,000 and 350,000.

The Wall Street Journal (12/23, A4, Dougherty, Subscription Publication, 2.08M) notes that these weekly unemployment claims may vary due to seasonal differences, but the monthly averages for the past three months have shown declines in unemployment applications, and economists are now predicting a more positive outlook for job hiring.

US Economy Projected To Grow About Two Percent In 2012. The Wall Street Journal (12/23, A4, Dougherty, Subscription Publication, 2.08M) reports that economists are now predicting that in 2012 the US economy will grow at a rate of about two percent based on continued issues in the housing market, tepid job growth, government spending cuts and the economic crisis in Europe. However, this forecast means that 2012 should see a bit more growth than this year’s estimated 1.7 percent yearly growth, and it’s possible that growth will be higher than anticipated in 2012, especially given Q4 2011’s predicted 3.5 percent growth.

Consumer Confidence Edges Higher, Beating Expectations. Bloomberg News (12/22, Willis) reports, “The Thomson Reuters/University of Michigan final index of consumer sentiment climbed to 69.9 from 64.1 at the end of November.” A Bloomberg News survey projected that consumer sentiment, or confidence, would increase to “for 68 after a preliminary reading of 67.7.” According to Bloomberg, “a drop in unemployment and lower gasoline prices may be boosting confidence, raising the odds that the pickup in household spending will continue into 2012.”

Canadian Manufacturing On The Rebound.

The Globe and Mail (Toronto, CA) (12/23) reports a slideshow titled, “Manufacturing set for year-end rebound,” noting that “Canadian manufacturing had its second-best month for 2011 in October and analysts expect another increase this month.” The slideshow focuses on the metals sector.

Auto, Energy Industries To Drive Steel Industry Growth.

Following earlier reports on the mixed but generally upbeat predictions for the US steel industry, IndustryWeek (12/23, Katz) reports, “The industry is not expected to reach a full recovery until 2013, according to Fitch Ratings.” Monica Bonar, a senior director at Fitch, said “steel producers are being cautious about how much inventory they’re stocking, including raw materials, on fears of a downturn.” Larry Kavanagh, president of the Steel Market Development Institute, said demand from the auto industry is expected to rise in the coming year, and that “the energy sector presents significant growth potential for the steel industry, led by the boom in shale gas exploration and distribution.”

Missouri Gains 11,000 Manufacturing Jobs.

The Kansas City Business Journal (12/23, Subscription Publication) reports “Missouri gained 10,900 manufacturing jobs between December 2010 and last month, an accomplishment Gov. Jay Nixon lauded Thursday.” Nixon said, “For generations, manufacturing has been a vital driver of Missouri’s economy, and modern manufacturing companies have offered opportunities for outstanding careers to folks across our state.” Nixon “also praised growth yet to come in the state’s automotive sector, particularly Ford Motor Co. and General Motors Co. making historic announcements in October.”

Mass Layoffs Decline In Missouri. Another Kansas City Business Journal (12/23, Subscription Publication) article reports, “Missouri mass layoffs were less common in November, dropping to 22 events compared with 29 a year earlier, the US Department of Labor reported Thursday.” In November, “1,440 Missourians made initial claims for unemployment insurance, down from 2,159 a year prior,” the Labor Department reported. And while “the manufacturing sector claimed a quarter of the mass layoff events,” the article notes that “15 of the 21 manufacturing subcategories saw over-the-year decreases in claims.”

From SME Daily Executive Briefing 12.23.2011

Economic News

Posted December 21, 2011 by Sonja Marshall

Data Show US Unemployment Down In November.

ABC World News (12/20, story 2, 2:40, Stephanopoulos) reported that there was “good news today on the economy,” as employment is increasing. Cecilia Vega reported that “it hasn’t looked this good in a really long time,” but in November almost “every state in the country saw unemployment drop,” and the US continues to see about 100,000 new jobs each month since July, which “hasn’t happened since before” the recession began. North Dakota is leading the US with an unemployment rate of 3.5 percent, well “below the national average of 8.6 percent,” due to “an oil boom.” According to Brookings Institute economist Howard Wial, “I think we’re going to see continued job growth and reductions in unemployment in the country as a whole.”

Home Construction Data Signals Housing Turnaround.

The AP (12/21, Kravitz) reports that “builders in November broke ground on homes – houses and apartments alike – at an annual rate of 685,000” according to the US Department of Commerce. This represents “a 9.3 percent jump from October” and is “the fastest pace since April 2010.” The AP characterizes this as a “gradual comeback” for home constructions that “should add to the nation’s economic growth in 2011.”

The Washington Post (12/21, Irwin) reports that it seems as if “the deeply depressed housing sector finally seems to have found its bottom – and may even be starting to bounce back.” The Post also notes that “the number of building permits issued for new houses and apartments also rose, to 5.7 percent in November.” Brian Bethune of Alpha Macroeconomic Foresights is quoted saying, “The good news is that housing has switched from being a drag on overall growth, to modest positive contributions.”

ME Daily Executive Briefing 12.21.2011

Economic News

Posted December 15, 2011 by Sonja Marshall

Business Inventories Increase 0.8 Percent In October.

Bloomberg News (12/14, Willis) reports, “Inventories in the US rose in October by the most in five months as companies moved to bring stockpiles in line with demand. The 0.8 percent gain followed little change in stockpiles a month earlier,” according to the Commerce Department. “Sales climbed 0.7 percent during the month.”

The AP (12/14) reports, “When companies build up their inventories, it usually signals that they expect more sales. And the extra factory production needed to increase stockpiles boosts economic output.”

The Wall Street Journal (12/14, Bater, Morath) also covers the story.

NFIB Report: Small, Medium-Sized Businesses Plan To Increase Hiring.

The New York Times (12/13, Rampell) “Economix” blog reported, “Some good news in the job market: Small businesses plan to increase hiring, according to the latest report from the National Federation of Independent Business.” NFIB – “an industry group for small and medium-size businesses – conducts a survey each month on subjects like optimism, credit conditions and jobs. November’s survey showed that the net share of companies that were planning to hire workers was at its highest in 38 months.”

Bloomberg News (12/13, Willis) reported, “The share of owners projecting higher sales, adjusted for inflation, rose eight points to 4 percent, the highest since April. A gauge of expectations for better business conditions six months from now climbed four points to a net minus 12, marking a third monthly gain from a record-low of minus 26 in August.”

The Washington Post (12/13, Harrison) “On Small Business” blog reported, “Eight of the 10 index components improved or remained unchanged from the October report, with the most substantial gains posted in sales expectations gains and outlooks for business conditions – again, not necessarily because more owners expect improvement in those areas, but because fewer owners expect sales and business conditions to worsen.”

On its website, CNBC (12/14, Orsini), Dow Jones Newswires (12/14, Derby) and other media sources also cover the story.

From SME Daily Executive Briefing 12/14/2011