NFIB: Small Business Optimism Increased in November

The NFIB Small Business Optimism Index surprised to the upside and edged up to 99 in November. The monthly gain largely was the result of an increase in the share of small firms reporting stronger sales expectations and a rise in hiring intentions. Cost pressures are still evident, with a sharp increase in businesses reporting that they recently raised selling prices and are planning to raise compensation. Key findings include:

• The net percent of owners raising average selling prices rose 13 points from October to a net 34% (seasonally adjusted), the highest reading since March 2023 and the largest monthly jump in the survey’s history.
• 21% of small business owners cited labor quality as their single most important problem, down 6 points, erasing most of October’s sudden increase. Labor quality ranked as the top problem, 6 points ahead of inflation, which ranked second. 
• The net percent of owners expecting higher real sales volumes rose 9 points from October to a net 15% (seasonally adjusted). This component contributed the most to the rise in the Optimism Index. 
• The average rate paid on short maturity loans was 7.9% in November, down 0.8 points from October and the lowest level since May 2023. 
• When asked to evaluate the overall health of their business, 11% reported it as excellent (down 1 point), and 53% reported it as good (up 2 points). Thirty percent reported the health of their business as fair (down 3 points), and 5% reported it as poor (up 1 point). 
• 64% of small business owners reported that supply chain disruptions were affecting their business to some degree, up 4 points from October. 
• The net percent of owners expecting better business conditions fell 5 points from October to a net 15% (seasonally adjusted). Expectations for better business conditions have fallen by 32 points since January.

Read more at The NFIB

September & October JOLTS Reports: More Openings, More Layoffs, Fewer Quits

The JOLTS data for September and October were a mixed bag. On the positive side, openings jumped from 7.2 million in August to 7.7 million in October, an encouraging pop that brought openings per unemployed worker back to roughly a 1:1 ratio. On balance, the jump in openings is a positive sign that suggests some stabilization in labor demand during the fall months, but the underlying details suggest workers currently face a labor market that is slightly on the wrong side of full employment.

That said, the quits rate dropped to 1.8%, its lowest reading since the depths of the pandemic in 2020. The layoff rate also inched higher to 1.2% in October. Although this remains low by historical standards, it matched the highest monthly reading since the pandemic ended. The steady grind higher in the layoff rate and steady grind lower in the quits rate over the past couple years are signs that the labor market has softened.

Read more at Wells Fargo

US Import Prices Rose in September, Export Prices Unchanged

U.S. import prices stayed the same in September, after advancing 0.1% in August, with lower fuel import prices offsetting higher nonfuel import prices. Over the past year, import prices rose 0.3%. Meanwhile, U.S. export prices also remained the same in September, after ticking up 0.1% in August. Over the past year, export prices climbed 3.8%, the largest over-the-year rise since December 2022.

In September, U.S. import prices for manufacturing rose 0.3% over the year, but with significant divergences in prices across the industry, while U.S. import prices for nonmanufacturing decreased 2.2% over the year. Beverage and tobacco product manufacturing experienced the most significant over-the-year U.S. import price declines in September, falling 13.8%. On the other hand, the greatest yearly increase in U.S. import prices occurred in primary metal manufacturing, which advanced 12.1% from September 2024. Meanwhile, U.S. export prices for manufacturing in September grew 4.1% over the year, with primary metal manufacturing export prices exhibiting the largest rise (29%).

Read more at The Bureau of Labor Statistics 

Middle East

• Gaza Sits Under 68 Million Tons of Rubble. A Look at the Daunting Task Ahead. – WSJ
• Israeli Army Takes Journalists Into A Tunnel In A Gaza City It Seized And Largely Flattened - AP
• Hamas Says No Second Phase For Gaza Ceasefire Until Israel Ceases 'Violations' – France 24
• Hamas Calls For More International Pressure On Israel Before Ceasefire’s Next Phase - AP
• A New Syria? One Year After The Fall Of Bashar Al-Assad – France 24
• Iran Objects To ‘Pride Match’ Branding Of World Cup Soccer Game Against Egypt - BBC
• Interactive Map- Israel’s Operation In Gaza – Institute For The Study Of War
• Map – Conflicts in the Middle East – Live Universal Awareness Map

Ukraine

• Ukrainians Raise Flag To Show BBC The Fight Goes On In City Claimed By Russia – BBC
• NATO Warns Putin: ‘We’re Not Going Anywhere’—Ukraine War - Newsweek
• Zelenskyy Reaffirms His Refusal To Cede Land To Russia As He Rallies European Support - AP
• The Territorial Sticking Point Between Russia and Ukraine - NYT
• Trump Gives Zelensky New Deadline On Peace Plan—Report - Newsweek
• UK Rejects Trump’s Claim That European Leaders ‘Talk Too Much’ About Ukraine - Politico
• 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

• Japan Warns Of Possible Megaquake After Powerful Earthquake, Raising Fears Of Potential 98-Foot Tsunami - CBS
• French Lawmakers Approve Social Security Budget In Victory For PM Lecornu – France 24
• Trump Thrashes European Leaders In Wide-Ranging Politico Interview: ‘I Think They’re Weak - Politico
• Louvre Workers Announce Strike Over Work Conditions And Security – France 24
• Dozens Killed In Haiti’s Capital As Armed Men Break Away From Gang Coalition In Bid For Power - AP
• As Pope Leo’s MAGA Criticism Builds, Trump Suggests He’d Meet Catholic Leader - Politico
• Cambodia Retaliates In Renewed Clashes With Thailand As Death Toll Mounts To 10 – France 24
• UK Sanctions Russian And Chinese Firms Suspected Of Being ‘Malign Actors’ In Information Warfare - AP
• Japan Worries Chinese Carrier Drills Near Okinawa Are Here To Stay – Nikkei Asia

An Unusually Divided Fed Is Expected to Deliver a Rate Cut Later Today

When Federal Reserve officials gather Tuesday for their final two-day rate-setting meeting of the year, as much as half the room might not want a cut. But the final call will rest with Chair Jerome Powell, who appears poised to secure one despite the unusual opposition. The focus this week will be whether Powell can stitch together enough consensus to minimize dissents. That would likely happen by cutting interest rates a quarter point to a range of 3.5% to 3.75% and then signaling a higher bar for further easing, through changes to the post-meeting statement. This cut-and-cap approach would echo how Powell concluded a sequence of three rate cuts in 2019 that also divided the committee.

Powell led his colleagues to cut in September and October after judging that the labor market looked shakier and the tariff-driven inflation surge that many feared hadn’t materialized. That assessment would also underpin a decision to cut this week. Yet resistance to cuts has built among a group of policymakers who already saw a weak case for cutting at the past two meetings. These officials are uneasy because inflation has stopped declining toward the Fed’s 2% target. They worry interest rates might not be high enough to push it lower.

Read more at the WSJ

Senate To Vote Thursday On GOP Health Care Plan

The Senate will vote Thursday on a Republican proposal to replace enhanced health insurance subsidies under the Affordable Act with health savings accounts that would receive federal contributions to pay out-of-pocket expenses, Senate Majority Leader John Thune (R-S.D.) announced Tuesday. The Senate was already set to vote Thursday on a Democratic plan to extend the expiring subsidies for three years, and Thune’s decision will give Republican colleagues the opportunity to vote for a GOP alternative. He was under heavy pressure from Senate Republicans who warned that failing to advance a Republican plan would be a catastrophe.

Thune said the plan from Sens. Bill Cassidy (R-La.) and Mike Crapo (R-Idaho) has support from a majority of Senate Republicans and argued it would reduce health insurance premiums and save the federal government nearly $30 billion. “It actually does make health insurance premiums more affordable. It drives down, according to the Congressional Budget Office, premiums by double-digit levels. It delivers the benefit directly to the patient, not to the insurance company. And it does it in a way that actually saves money — to the taxpayer,” he said. “That is an alternative that we will put forward and we will have a vote on, on Thursday. And we’ll see where the Democrats come down on that,” Thune said.

Read more at The Hill

Politico Poll: Voters Begin Blaming Trump For Affordability Crisis

New polling shows many Americans have begun to blame President Donald Trump for the high costs they’re feeling across virtually every part of their lives — and it’s shifting politics. Almost half — 46 percent — say the cost of living in the U.S. is the worst they can ever remember it being, a view held by 37 percent of 2024 Trump voters. Americans also say that the affordability crisis is Trump’s responsibility, with 46 percent saying it is his economy now and his administration is responsible for the costs they struggle with.

While inflation rates have fallen from a high of 9.1 percent during the Biden administration to roughly 3 percent last month, voters’ frustration with the cost of living has remained elevated. Across parties, age groups, races, genders and income levels, Americans say the cost of living is the nation’s top problem, The POLITICO Poll finds, a sign that the economy will again overshadow other political topics in next year’s midterms.

Read more at Politico

More Policy and Politics Headlines

• 20 Signs There's An Affordability Crisis In America. – Forbes
• Trump Tries To Flip The Script On Affordability In Pennsylvania – The Hill
• Trump Approval Rating Rises As Republicans Back Cost-Of-Living Efforts - Reuters
• Supreme Court Hears Campaign Spending Case - ABC
• Administration Moves To Remove Millions Of Student Loan Borrowers From Payment Pause - CNBC
• High Court To Weigh Courts' Power Over Arbitration Awards – SHRM
• Trump Argues National Security At Risk If Supreme Court Rules Against Tariffs – The Hill
• For Airlines, Trump’s Deregulation Is Gift That Keeps On Giving - Forbes
• Nassau County Executive Bruce Blakeman Launches Bid For New York Governor, Challenging Stefanik – The Hill
• Proposed Model Bill Would Change College Tenure, Teaching, & Research – Forbes

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Eli Lilly's GLP-1 Weight-Loss Pill Could Face Off Against Wegovy This Spring

Executives from Eli Lilly said last week that they hope their new GLP-1 agonist weight-loss tablet, orforglipron, will be on the market by early spring — and that they think a weight-loss tablet could be more popular than an injectable drug. In studies, orforglipron has helped patients in studies lose about 12% of their body weight. Novo Nordisk's injectable drug Wegovy helped obese patients lose 17% of their weight in one study, and Eli Lilly's injectable drug Zepbound helped patients lose 20% of their weight.

"We've seen many providers, as well as many people, not ready for an injectable therapy," Ilya Yuffa, an executive vice president at Lilly, said last week at a health conference organized by Citi. "We see an oral option being a great entry point." In other cases, Yuffa said, patients could start by taking Zepbound — a weight-loss drug that acts both as a GLP-1 agonist and a GIP agonist — and then use orforglipron or another oral weight-loss drug to keep weight off once they've reached their preferred weight. Having access to an oral version of an effective weight-loss drug should increase the number of people who try using a prescription weight-loss drug, Yuffa said.

Read more at Benefits Pro

Upcoming Council Programs

Events

Manufacturing Champions Award Breakfast - Friday May 8, 2026 -7:45 - 10:00 AM. The DoubleTree Poughkeepsie.

Networks

HR Sub Council Meeting Topic TBD, January 14, 2026, 8:15 - 11:00. Selux Corporation, Highland.

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Training

Certificate in Manufacturing Leadership Program Winter Session, Virtual. Supervisor Training Program for Hudson Valley Manufacturers. 7 Courses (15 half day sessions) January 6 - March 11 Via Zoom.

Lean Six Sigma Green Belt This program combines online coursework, with live Zoom sessions, to deliver a flexible and effective learning experience in Lean Six Sigma methodologies. Most Mondays March 2 - June 8 Via Zoom.

(Special Info session for those who are 'Green Belt curious' February 23rd)

Lean Six Sigma: Yellow Belt - Yellow Belt is an approach to process improvement that merges the complementary concepts and tools from both Six Sigma and Lean approaches. 3 Full days - March 9,10 & 11 - DCC Fishkill.

Trade Wars

• Ford and Renault Team Up in Europe to Compete Against Low-Price Chinese Cars – WSJ
• China Urges Trade Partners Against Tariffs As Record Surplus Stirs Tensions - Reuters
• Mexico to Hike China Tariffs, Raising Hopes of US Steel Relief - Bloomberg
• Trump Threatens Mexico With Even Higher Tariffs - CNN
• EU Says It Will ‘Make Sure’ Elon Musk’s X Pays €120M Fine - Politico
• Tariff-Proofing The Rogue: Nissan Considers Making Hybrid Powertrains In Tennessee – Auto News
• Nvidia AI Chips to Undergo Unusual U.S. Security Review Before Export to China – WSJ

China’s Manufacturing Is Booming Despite Trump’s Tariffs

Chinese industrial production broke records this year as its factories churned out more cars, machinery and chemicals than ever before. Despite the disruptions of tariffs, the country’s trade surplus in goods has set a record, as growing shipments to Asia, Europe, Latin America and Africa offset the hit from Trump’s levies on direct sales to the U.S. Chinese companies that built their business around low trade barriers to sell into the U.S. have adapted and in some cases are bouncing back.

The Chinese manufacturing juggernaut shows little sign of slowing. China reported a goods trade surplus of more than $1 trillion for the year through November, while manufacturing output in the first 10 months of the year was up 7% compared with the same period in 2024. Strip out imports of energy, food and raw materials, and China is on track this year to post a surplus in manufactured goods of around $2 trillion, a huge sum that is on a par with the annual national income of Russia or Italy. China’s surprisingly strong export performance hasn’t been without costs. The economy is battling an insidious phenomenon dubbed “involution,” in which cutthroat competition and ballooning industrial capacity are pushing down prices, profits and incomes.

Read more at the WSJ

PepsiCo Planning Price Cuts Amid Affordability Crunch

PepsiCo, the maker of Lay’s, Doritos and Pepsi-Cola, plans to completely eliminate nearly 20% of its products in the U.S. by early next year. PepsiCo is the latest company to respond to poor consumer sentiment and affordability concerns among Americans. Facing weakened consumer demand like PepsiCo, Target recently announced price reductions on 3,000 food, beverage and essential items. Target reported a 2.7% drop in sales in its latest quarter amid a 1.5% slide in revenue.

The company did not specify which remaining products would have reduced prices, saying it plans a “targeted approach” to achieve “sharper everyday value.” PepsiCo’s North American supply chain will also be reviewed as part of the initiative, according to the statement, which said the changes aim to “accelerate organic revenue growth, deliver record productivity savings and improve core operating margin – starting in 2026.” The company said that in its push to reduce operating costs, it has closed three manufacturing plants and shuttered “several manufacturing lines this year.”

Read more at Forbes

Pentagon Issues $1.14B for F-35 Supplies

Lockheed Martin has picked up a $1.14-billion modification to a previously assigned contract for purchasing long-lead materials for a total of 198 F-35 aircraft. The Pentagon announcement of the award indicated it anticipates production of 65 jets for Lot 20 and 133 for Lot 21. However, no firm contract for those aircraft has been settled. The current award is intended to avoid program delays due to sourcing of materials, components, and systems once the Pentagon and Lockheed arrive at an agreement. Once production is agreed, the work will be performed at multiple Lockheed locations in the U.S. and one in England. The project is scheduled for completion in December 2030.

The F-35 is a series of fighter jets deployed for ground attack and combat, and available in three variants – for the U.S. Air Force, U.S. Marine Corps, U.S. Navy, and for the defense forces of more than a dozen other nations. Lots 20 and 21 will incorporate the various hardware and software updates planned as part of the F-35 Block 4 update – which will introduce more than 80 improved capabilities meant to keep the F-35 competitive against emerging threats, including improved sensors, sensor fusion, and expanded weapon capabilities.

Read more at American Machinist

Pentagon Eyes Near-Term AI Adoption

The Trump administration is gearing up to launch an ambitious new plan to spur the military’s near-term adoption of artificial intelligence assets by supplying commercial options directly to users on the ground across three categories that reflect real-world operational needs, according to the Pentagon’s chief technology officer. Pentagon CTO and R&E leader Emil Michael shared new details about the DOD’s latest pursuits to reform and accelerate AI integration for in-office functions and modern warfare, during a roundtable with reporters on Monday hosted by the Defense Writers Group.

Noting that the CDAO’s approach and mission has shape-shifted a number of times since its early days, Pentagon CTO and R&E leader Emil Michael said the “new regime” will be primarily focused on building stronger relationships with major AI companies to quickly deliver models and tools that are tailored for Pentagon-specific use cases. “Now you have four giant companies: Anthropic, xAI, OpenAI and Google, right? So, you have four investing hundreds of billions of dollars in infrastructure, in research and development, data centers, power cooling chips — you name it. So the explosion of capabilities has been enormous, and we’re just catching up to that.”

Read more at Defense Scoop

Discrimination Lawsuit Ends with a $11.5 Million Verdict Against SHRM

A Colorado jury on Friday returned a verdict in favor of the plaintiff in SHRM’s race discrimination and retaliation trial, awarding the plaintiff compensatory damages of $1.5 million and punitive damages of $10 million. The jury verdict came in Friday afternoon, capping off a week-long trial that dug into allegations from a former instructional designer that the HR organization retaliated against her and set her up to be fired after she complained that her supervisor favored direct reports who were White over those who were not. The unfavorable verdict is the latest challenge in what has been a rocky year for SHRM.

SHRM was adamant the jury had reached the wrong conclusion. “This claim has no merit. None. Today’s decision does not reflect the facts, the law, or the truth of how SHRM operates,” SHRM said. “We have acted with integrity, transparency, and in full alignment with our values and obligations. We remain steadfast in our mission, undeterred in our focus, and resolute in our commitment to stand up for what is right.” Ashley Herd, founder and CEO of Manager Method and co-host of the “HR Besties” podcast, said in a recent LinkedIn post that all HR leaders should be paying attention to the case. “It’s a reminder of why processes and conversations matter — and how easy it can be for ‘best practices’ to not actually be followed in real life,” she wrote.

Read more at HR Dive

TSMC Says It Is Accelerating An Advanced Packaging Facility In Arizona

One of the caveats of TSMC's manufacturing in the U.S. is that all wafers processed at Fab 21 in Arizona are shipped back to Taiwan for dicing, testing, and packaging, which is why processors fabbed in Arizona are not 100% U.S.-made. However, TSMC is reportedly repurposing land designated initially for one of its Fab 21 modules for its advanced packaging facility, thus accelerating its packaging capability in the U.S. and making 'all American TSMC chips' a reality before 2030.

Based on the latest expansion plan for the Arizona site announced in March, TSMC plans to build six Fab 21 modules, two advanced packaging facilities, and an R&D center to work on the foundry's existing technologies and tailor them for specific customers. Liberty Times claims that TSMC now intends to build its advanced packaging facility on the place originally intended for the Fab 21 phase 6. If construction proceeds according to the alleged plan, tool move-in could begin before the end of 2027, enabling the plant to enter a risk production phase shortly thereafter.

Read more at Tom’s Hardware

Pfizer Adds To Obesity Bet With Up To $2.1 Billion Deal To Develop Chinese Company’s Pill

Pfizer on Tuesday said it has struck an up to $2.1 billion licensing deal with YaoPharma to develop and commercialize its obesity pill, furthering the pharmaceutical company’s push into the weight loss space.  Pfizer will pay YaoPharma, a subsidiary of Chinese drugmaker Shanghai Fosun Pharmaceutical, an upfront payment of $150 million. YaoPharma could also receive up to $1.94 billion in milestone payments, along with tiered royalties on sales if the drug is approved.

YaoPharma’s drug works by targeting the same gut hormone, GLP-1, as Novo Nordisk ’s blockbuster weight loss injection Wegovy. But the pill is still in early-stage development, which means it will take several years before it reaches patients.  The deal will help Pfizer beef up and diversify its obesity drug pipeline after a string of setbacks, including its decisions to scrap two different pills over the last two years. The drugmaker boosted its prospects in the competitive space with its up to $10 billion acquisition of the obesity biotech Metsera last month, following a fierce bidding war with Novo Nordisk.

Read more at CNBC

Microsoft Investing $17.5 Billion In India For AI And Cloud Infrastructure

Microsoft on Tuesday announced its biggest-ever Asia investment, amounting to $17.5 billion, in India over the next four years to advance the country’s cloud and artificial intelligence infrastructure. CEO Satya Nadella revealed this in an X post after meeting with Indian Prime Minister Narendra Modi in New Delhi. Nadella said that Microsoft was committing the investments to help India build the “infrastructure, skills and sovereign capabilities” needed for its AI future.

The announcement underscores the growing global competition among major technology companies to expand in India, which has become one of the world’s fastest-growing digital markets. In October, Google said it will invest $15 billion in India over the next five years to establish its first AI hub in the country. Located in the southern city of Visakhapatnam, the hub will be one of Google’s largest globally.

Read more at The Hill

Amazon Leads $81 Million Financing for Battery Startup Blue Current

Amazon.com has led an $81 million funding round for battery startup Blue Current, a deal that comes as the e-commerce giant is expanding its fleet of electric delivery vans. Blue Current is making battery cells at a facility in Hayward, Calif., and said its batteries could be on the market by 2030. Founded in 2014, Blue Current says its silicon solid-state batteries can power a variety of vehicles and offer them longer range and faster charging rates than existing electric-vehicle batteries.

Solid-state batteries are prized by automakers looking for safer alternatives to combustible lithium-ion batteries, as well as for their potential to store greater amounts of energy and charge faster than their lithium-ion rivals. But costly manufacturing and other hurdles have kept them from becoming commercially viable. Global private battery companies are expected to have raised $19.6 billion by the end of this year, 34% less than they raised in 2024, according to a report by climate-tech analytics firm Net Zero Insights.

Read more at The WSJ

Quote of the Day

"A great Hope fell

You heard no noise

The Ruin was within

Oh cunning wreck that told no tale

And let no Witness in"

Emily DIckinson - American Poet from her 'A Great Hope Fell.' She was born on this day in 1830.

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