Member Briefing April 4, 2024
Study: Manufacturing in U.S. Could Need Up to 3.8 Million Workers
The U.S. manufacturing industry could require some 3.8 million jobs to be filled within the next decade, according to a new joint study from Deloitte and the Manufacturing Institute, the NAM’s 501(c)(3) workforce development and education affiliate. The report found that manufacturing in the U.S. has emerged from the global pandemic on strong footing and is likely to continue to grow in the next few years. That growth will call for even more skilled workers—particularly statisticians, data scientists, logisticians, engineers, computer and information systems managers, software developers and industrial maintenance technicians—spotlighting the need to build the national talent pipeline.
Top takeaways from the report include:
- If workforce challenges are not addressed, more than 1.9 million of the up to 3.8 million jobs likely to be needed between this year and 2033 could go unfilled.
- Some 65% of manufacturers polled said attracting and retaining talent is their primary business challenge.
- About 90% said they are forming at least one partnership to better attract and retain employees, and on average they have at least four such partnerships.
- Approximately 47% indicated that apprenticeships, work study programs or internships at manufacturing companies would be the most effective way of increasing interest in the industry.
- Some 47% also said flexible work arrangements—such as flex shifts, shift swapping and split shifts—have been their top retention tool.
US Factory Orders Increase Solidly in February
New orders for U.S. manufactured goods rebounded more than expected in February. Factory orders increased 1.4% after dropping 3.8% in January, the Commerce Department's Census Bureau said on Tuesday. The government also reported that orders for non-defense capital goods excluding aircraft, which are seen as a measure of business spending plans on equipment, rose by an unrevised 0.7% in February
- Shipments of manufactured goods increased 1.4%, while inventories rose 0.3%.
- Unfilled orders at factories were unchanged for a second straight month.
- Commercial aircraft orders increased 24.6% in February after slumping 63.5% in the prior month.
- Orders for motor vehicle bodies, parts and trailers rose 0.3%. Overall transportation orders rebounded 3.3% after tumbling 18.3% in January.
- Machinery orders increased 1.8%, lifted by a 12.5% surge in mining, oil field and gas field machinery.
- There were also increases in orders for fabricated metal products and primary metals.
- But orders for computers and electronic products declined 1.4%, while those for electrical equipment, appliances and components decreased 2.1%.
Global Headlines
Middle East
- Israel and Hamas: The Latest News – The Guardian
- Israel's Secret 'Lavender' AI Used for Gaza Kill Lists, Report Claims - MSN
- Israel War Cabinet Member Gantz Calls for September Elections Amid Gaza Assault – Reuters
- The Israel-Gaza War is at a Crossroads - BBC
- US May Revoke Houthi Terrorist Label If They Stop Red Sea Ship Attacks - Bloomberg
- Many Iranian Options to Retaliate Against Israel, But All Carry Risk – Reuters
- Israel Blames Misidentification for Strike That Killed Gaza Aid Workers - WSJ
- Chef Jose Andres Says Israel Targeted His Aid Workers 'Systematically, Car by Car’ – Reuters
- Israel Faces Mounting Outrage from Allies After Killing World Central Kitchen Aid Workers – Politico
- Interactive Map- Israel’s Operation in Gaza – Institute for the Study of War
- Map – Tracking Hamas’ Attack on Israel – Live Universal Awareness Map
Ukraine
- Ukraine and Russia: The Latest News – The Guardian
- Deepest Ukraine Drone Attack Into Russian Territory Injures 12 - BBC
- NATO Chief Floats 100 Billion Euro Fund for Kyiv - CNBC
- White House Signals Opposition to NATO-Led Weapons Group for Ukraine – The Hill
- Finland Signs Ukraine Security Deal, Zelenskiy Warns of Russia Troop Plans - Reuters
- Ukraine is at Great Risk of its Front Lines Collapsing – Politico
- France’s Macron Tries to Jolt Europe Into Taking Tougher Approach With Putin - WSJ
- Japan's Support for Ukraine is Unwavering, PM Kishida Tells Zelenskiy – Reuters
- Interactive Map: Assessed Control of Terrain in Ukraine – Institute for the Study of War
- Map – Tracking Russia’s Invasion of Ukraine – Live Universal Awareness Map
Other Headlines
- Taiwan’s Strongest Earthquake in 25 Years Kills at Least Seven - WSJ
- Taiwan: Rescue Efforts Continue After 900 Injured in Earthquake - BBC
- China's Tech Workers Trapped in Jobs by Noncompete Contracts - Nikkei
- Ugandan Court Upholds Large Parts of Antigay Law - WSJ
- Cyprus Declares Migration Crisis, Calls for EU to Help – Politico
- South African Parliament Speaker Resigns Amid Corruption Probe - Reuters
- Turkey’s Inflation Climbs to 68.5% Despite Continued Rate Hikes - CNBC
- Haiti Gangs: More Than 50,000 Flee Capital After Surge in Violence - BBC
Policy and Politics
NYS Budget is Expected Today
Lawmakers appear cautious to avoid the kind of blowup that delayed last year’s spending plan by more than a month as Democrats fought over bail laws and a plan to spur housing construction. Still, familiar subjects have emerged as sticking points this year. Lawmakers are trying to forge a deal on a housing plan that includes new construction, tenant protections and a tax break for developers to incentivize building in a state notorious for high rents and home costs.
There has also been a split over Hochul’s proposal to raise criminal penalties for assaulting retail workers, part of her larger strategy to address crime concerns in the state. Legislative leaders rejected her plan not long after it was announced, arguing the state already has laws against assault and said enhancing penalties won’t stop crimes. Another potential avenue for disagreement is Hochul’s proposal to change how the state gives out education funding to schools. The governor has said her plan would result in the state better directing money to districts that need additional funding. But it has drawn criticism because it would result in some districts getting less money.
Read more at Long Island Business News
Powell Still Sees Room for the Fed to Cut Rates This Year
Stronger-than-anticipated economic activity this year hasn’t changed the Federal Reserve’s broad expectation that declining inflation will allow for interest-rate cuts this year, Chair Jerome Powell said Wednesday. Powell pointed to signs that labor-market conditions are less tight than they have been in recent years, a view that has eased concerns that paychecks and prices might rise in tandem.
Stronger-than-anticipated economic activity this year hasn’t changed the Federal Reserve’s broad expectation that declining inflation will allow for interest-rate cuts this year, Chair Jerome Powell said Wednesday. Powell pointed to signs that labor-market conditions are less tight than they have been in recent years, a view that has eased concerns that paychecks and prices might rise in tandem.
Birthrates are Tumbling Worldwide, Forcing Hard Choices on Societies
After a century in which the global population grew almost fourfold to 6.2 billion people, stoking fears of overpopulation, conflict, and ecological collapse, a turning point awaits. At some point in the 2060s, 2070s, or 2080s, the world population, currently 8 billion, will peak around 10 billion, according to forecasts, and then start to decline. An end to humanity’s relentless expansion is in sight. When it comes, debates about population growth, which have been driven by beliefs that humanity is too fecund for the Earth’s carrying capacity, will acquire a different character.
What goes up fast can come down just as fast, measured in decades and centuries, setting the stage for an era of population shrinkage that seems both inexorable and unfathomable. Depopulation raises complex questions about how best to sustain a flourishing society where institutions can endure. Aging societies with declining populations are already a reality in countries like Italy and Japan, where rock-bottom fertility rates have shrunk the workforce and strained public finances. But the scale of the demographic transition in the next century or two, when every country and region would be affected, is far more challenging to imagine or fully anticipate.
Health and Wellness
CDC Closely Monitoring Cases of Bird Flu, Taking Animal to Human Case Seriously: Official
Although still confident the risks of avian flu to the human population are low, a Centers for Disease Control and Prevention senior official told ABC News they are taking seriously dairy cows being infected in at least 11 farms and, most recently, a human dairy farmer in Texas. Public health officials have been "working on avian flu and preparing for it [in humans] for 20 years," the senior CDC official told ABC News. "We've invested in our ability to test for it, to prevent it, to treat it."
The official said the human who contracted avian flu, discovered last week in Texas, works with dairy cows. They "had mild symptoms; they're doing well and recovering," the official said. The official went on to say that the CDC and the U.S. government were "taking this situation very seriously and closely monitoring it." The federal agency is working with local health departments, state health departments and the U.S. Department of Agriculture and has, over the last two decades, invested in the ability to prevent and treat the disease, the official added.
Election 2024
- Trump Leads Biden in Six of Seven Swing States, WSJ Poll Finds - WSJ
- Cook Political Report Shifts Nevada Senate Race Toward Republicans – The Hill
- Ballot Access a Challenge for Third Party, Presidential Candidates in New York – NY State of Politics
- Florida Democrats See Ray of Hope for Senate Race After Abortion Rulings – The Hill
- Real Clear Politics Latest GOP Primary Polls – Real Clear Politics
- Real Clear Politics Latest General Election Polls – Real Clear Politics
- Latest Polls - FiveThirtyEight
Industry News
Baltimore Bridge Collapse Triggers Extensive, Costly Logistics Diversions
The effort to locate shipments, find new ports and patch together new transportation is part of a massive logistics undertaking in and around one of the U.S. East Coast’s biggest ports. It takes in operators including major automakers around the world, local truckers, and railroads, as well as a range of exporters and importers trying to contain the impact of the latest disruption to hit global supply chains.
Business analytics group Dun & Bradstreet estimated the weekly impact of the port closure on trade at about $1.7 billion, based on the value of consumer goods, automobiles, coal and other shipments that moved through the port on average each week in 2023. Authorities at ports from New York-New Jersey to Savannah, Ga., have said they have the capacity to handle the diverted cargoes. The Port of Virginia says it is extending some operating hours to handle any extra volume. Shifting those goods to other ports will raise transportation costs for shippers and logistics operators, however.
ISM Services PMI Slows, but Still Expands for 15th Straight Month
The ISM services index came in at 51.4 in March, signaling a more modest pace of expansion in the service sector. The narrative of a booming service sector amid struggles for manufacturing is giving way to a more balanced state of activity. Monday's manufacturing ISM surprised on the upside; today's services ISM surprised on the downside. The upshot is the narrowest gap between services and manufacturing since 2022.
The eye-catching development in the details is how the prices paid component dropped more than five points to 53.4. The prices paid index dropped to its lowest reading since March 2020; however, the fact that 13 industries are still reporting an increase in prices suggests that even with some stabilization in the rate of price growth, inflation is still a concern. The biggest overall move among sub-components was a 5.5 point drop in order backlogs to a seven-month low of 44.8. One of the lone increases in this report came from the employment component, which rose a half a point to 48.5. That suggests the breadth of service sector hiring improved last month, but below 50 it's still consistent with layoffs in the sector.
TSMC’s Evacuated Workers Return to Some Factories After Taiwan’s Strongest Earthquake in 25 Years
Taiwan Semiconductor Manufacturing Co said all its workers were safe and those who were evacuated have started returning to some factory lines after a major earthquake hit Taiwan early Wednesday. The island was rocked by a massive earthquake that collapsed buildings and prompted tsunami advisories from Japan and the Philippines. Officials said at least four people have died.
A TSMC spokesperson said construction sites were normal upon initial inspection, but the company decided to suspend work at the sites for the day. The person said work will resume after further inspections and that TSMC is still evaluating details of the earthquake’s impact. Earlier, the chipmaker said it evacuated some personnel from some fabs in accordance with company safety protocols.
From Plant Microclimates to Deep Learning for Weeds, Farming Tech Feeds a Rising Population
Computer vision, a type of AI, helps farmers “see” beyond human capacity. AI shows what’s happening at critical junctures, informing important, in-the-moment decisions. For example, a large soybean farm can have approximately 750 million plants growing in one season. Each soybean plant grows in a unique microenvironment as soil conditions can vary from plant to plant. These conditions affect everything, from the size of the soybeans themselves to the yield of each plant. Just as with raising children, farmers need to tend to each plant individually. However, with 750 million plants, it’s impossible to give plants the one-on-one “time” they need.
Today, technologically advanced farm equipment leverages computer vision and machine learning to detect the difference between plants and the weeds that threaten their health, so only the weeds are sprayed with herbicides. The equipment uses deep learning, cameras and robotics to understand its surroundings, and it gets smarter over time as it “learns” through images collected as it operates. Computer-vision-enabled agricultural equipment can complete more tasks and focus on growing healthier, more successful crops with fewer herbicides. The result saves on cost while simultaneously improving environmental stewardship.
The Best Time to Sell Your House in the U.S. According to Zillow
Homes listed in early June make the most profit, according to a new Zillow report. Sellers need all the cash they can get to make their next move more palatable. May has long been the best month to list your house in the U.S. But in 2023, sellers made the highest profits in the first two weeks of June, a Zillow study shows.
This shift is largely due to mortgage rates, which cooled slightly in June and brought some buyers off the sidelines. On the other side, buyers who want to avoid peak pricing, should consider shopping outside of the spring and summer months. Interest rate cuts aren't expected anytime soon, but if those rates do fall in 2024, we may have a second spring market.
Intel Reveals $7 Billion Operating Loss in Foundry Business
Intel shares fell 4% at one point in extended trading on Tuesday after the company revealed long-awaited financials for its semiconductor manufacturing business, commonly called the foundry business, in a SEC filing. Intel said its foundry business recorded an operating loss of $7 billion in 2023 on sales of $18.9 billion. That’s a wider loss than the $5.2 billion Intel reported in its foundry business in 2022 on $27.5 billion in sales.
This is the first time that Intel has disclosed revenue totals for its foundry business alone. Historically, Intel has both designed its own chips as well as done its own manufacturing, and reported final chip sales to investors. Other American semiconductor companies such as Nvidia and AMD design their chips but send them off to Asian foundries — often Taiwan’s TSMC — for manufacturing.
GE Aerospace Sees Bright Future as Standalone Company
GE Aerospace CEO Larry Culp, who has led General Electric since 2018, rang the opening bell on the New York Stock Exchange Tuesday morning, celebrating GE Aviation’s transition into a publicly traded company alongside the energy spinoff GE Vernova. GE Health Care launched last year. “Building on a century of learning and carrying forth GE’s legacy of innovation, GE Aerospace moves forward with a strong balance sheet and greater focus to invent the future of flight, lift people up, and bring them home safely,” Culp said in a statement.
While commercial engines — particularly the CFM56 LEAP engine it produces with French engine maker Safran and is used in Boeing 737 MAX and Airbus A320neo narrowbody planes — will continue to make up the backbone of the company, its Defense and Propulsion Technologies unit “are very well positioned given lively defense spending trends over the next decade,” Culp said during a March investors day. GE Aerospace produces the propulsion plants for military planes such as the F-15EX, F-16, E-7 Wedgetail and T-7 training jet, as well as helicopter engines for the UH-60 Black Hawk, AH-64 Apache and CH-53K King Stallion.
FDA Approves AI Tool That Can Detect Sepsis
The U.S. Food and Drug Administration approved an AI tool that can diagnose sepsis, Prenosis, the company behind the software, announced Wednesday, the latest in a series of agency approvals for AI diagnostic tools. The Sepsis ImmunoScore uses 22 diagnostic and predictive parameters to calculate the risk of a patient developing sepsis within 24 hours, a criteria combination that has “never previously been available in a legally marketed device” for the condition, according to a press release.
Prenosis spokesperson Gary Poole told Forbes the criteria includes inflammatory biomarkers, vital measurements and demographic information, among others. The tool, which is integrated into hospitals’ electronic medical records, was built using the Chicago-based startup’s Immunix platform, which is a dataset containing more than 100,000 blood samples from more than 25,000 patients. The Sepsis ImmunoScore was approved through the agency’s De Novo pathway, the process the FDA uses for novel medical devices.
Navy Lays Out Major Shipbuilding Delays, in Rare Public Accounting
The Navy Tuesday released a rare public accounting of major delays for key shipbuilding programs, with ships from nine programs running behind, in some cases up to three years. In total, the Navy forecasts a cumulative delay of more than 11 years, at a time when lawmakers and Pentagon planners agree that the Navy needs to be modernizing and growing for a potential conflict in the Pacific. Among the notable delays as outlined by the report:
The first Columbia-class submarine, built jointly by General Dynamics Electric Boat and HII, is projected to be between 12 and 16 months late.
The fourth and fifth blocks of the Virginia-class submarine, also by Electric Boat and HII, are 36 and 24 months late.
The first Constellation-class frigate from Fincantieri Marinette Marine is 36 months behind schedule.
The future aircraft carrier Enterprise (CVN-80), built by HII, is approximately 18 to 26 months late.
Business Schools Are Going All In on AI
Top business schools are pushing M.B.A. candidates and undergraduates to use artificial intelligence as a second brain. Students are eager for the instruction as employers increasingly hire talent with AI skills. American University’s Kogod School of Business is putting an unusually high emphasis on AI, threading teaching on the technology through 20 new or adapted classes, from forensic accounting to marketing, which will roll out next school year. Professors this week started training on how to use and teach AI tools.
Understanding and using AI is now a foundational concept, much like learning to write or reason, said David Marchick, dean of Kogod. “Every young person needs to know how to use AI in whatever they do,” he said of the decision to embed AI instruction into every part of the business school’s undergraduate core curriculum. Marchick, who uses ChatGPT to prep presentations to alumni and professors, ordered a review of Kogod’s coursework in December after Brett Wilson, a venture capitalist with Swift Ventures, visited campus and told students that they wouldn’t lose jobs to AI, but rather to professionals who are more skilled in deploying it.