Member Briefing December 17, 2024
Empire Manufacturing Survey: Activity ‘Steady’ in December
Manufacturing activity was little changed in New York State, according to the December Empire Manufacturing Survey from the NY Federal Reserve. After shooting up over forty points last month, the general business conditions index fell thirty-one points to 0.2. Other indexes showed that price increases slowed, labor market conditions worsened and that firms remain optimistic.
- The new orders and shipments indexes retreated, but remained positive at 6.1 and 9.4, respectively, pointing to modest gains in both orders and shipments.
- The inventories index climbed to 10.5, signaling that inventories grew.
- The delivery times index fell eleven points to -7.4, suggesting that delivery times were shorter.
- The index for number of employees moved down to -5.8, and the average workweek index fell to -3.9, pointing to a small decline in both employment and hours worked.
- The prices paid index fell seven points to 21.1, and the prices received index declined eight points to 4.2, suggesting that both input and selling price increases moderated.
- The index for future business activity fell nine points to 24.6, with forty-two percent of respondents expecting conditions to improve over the next six months. Inventories are expected to continue to grow, and capital spending plans remained modest.
IndustryWeek Survey: Manufacturing Salaries Plunged in 2024 - Talent Easier to Find
In an ambiguous result for the manufacturing industry, average salaries reported by readers in our 2024 IndustryWeek Salary Survey fell almost across the board—$119,785.41 in 2024, 10.6% lower than the $ 133,996.66 reported in 2023. That nearly $14,000 salary decline, ironically, could be a good thing. In a more positive sign, the number of respondents indicating difficulty hiring skilled talent fell to pre-Covid lows. That apparent increase in the number of new hires may help explain some of the dramatic loss in average pay. IndustryWeek readers reported lower overall salaries across almost all groups compared to their 2023 responses.
In 2024, the number of respondents indicating their employer is having trouble sourcing skilled workers dropped to 71%, 12 points lower than 2023 and 15 points lower than 2022. Taken in concert with lower salaries, higher proportions of manufacturing workers with lower ages and less experience, this suggests that manufacturing is actually moving in a positive direction on hiring — glimmers of hope for an industry long concerned with a lack of available talent.
Cutting Tool Orders Advance, Now Even with 2023
Purchases of cutting tools by U.S. manufacturers and machine shops totaled $212.5 million, rising 12.6% from September but showing almost no improvement (up just 0.2%) over the October 2023 result. The month-over-month increase followed a -10.0% drop from August to September, and through 10 months of 2024 activity, cutting tool consumption totals $2.07 billion, or just 0.6% more than the comparable result for January-October 2023.
Cutting tool orders, as documented in the monthly Cutting Tool Market Report, are a relevant indicator of overall manufacturing activity because of the wide range of manufacturing sectors served by cutting-tool buyers. “Orders for cutting tools in the United States have slowed significantly as we approach the final months of 2024,” stated USCTI president Steve Boyer. “Several factors have contributed to this decline, including uncertainty in the political landscape, work stoppages at major cutting tool users, and ongoing challenges with high interest rates,” he continued. But Stokey pointed to economic forecasts showing “we are at the bottom of the curve, and better times are ahead. The upturn cannot come soon enough.”
Read more at American Machinist
Global Headlines
Middle East
- Palestinians Mourn Dead After Israeli Strike On Gaza's Khan Younis – Reuters
- UN Envoy Advocates Syrian-Led Transition Process In Talks With Rebel Leader - VOA
- Death Toll in Israel-Hamas War Surpasses 45,000 - Newsweek
- Syria’s Aspiring Leader Promises Reform—in Due Time - WSJ
- After Euphoria Of Assad’s Fall, Syrians Face Daunting Challenge Of Rebuilding Aleppo – France 24
- Iran Faces Dual Crisis Amid Currency Drop And Loss Of Major Regional Ally - CNBC
- Despite Ceasefire With Hezbollah, Residents Of Northern Israel Are Hesitant To Return Home - VOA
- Assad Says He Had No Plans To Leave Syria But Was Evacuated By Russians - AP
- 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 Will Have to Give Up Territory for Peace: NATO Leader – Newsweek
- Russia To Mass-Produce New Hypersonic Ballistic Missiles, Putin Says - Politico
- Putin Says Large Number Of Volunteers Is Turning The Tide Of Ukraine War In Russia's Favour - Reuters
- Ukraine Claims North Korean Troops Were Killed As They Fought Alongside Russian Forces - AP
- North Korean Troops Suffer Heavy Casualties In Russia, Ukraine Says – Washington Post
- Cajole, Plead and Flatter: Ukraine Makes Its Case to Trump - NYT
- Russia To Prepare For War With NATO - 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
- Germany’s Scholz Loses Confidence Vote, Triggering Path To Snap Elections – France 24
- France Rushes Aid To Mayotte, With Hundreds Feared Dead And Hunger Rising After Cyclone Chido – France 24
- Pope Francis Makes 1st Papal Visit To France’s Corsica Awash In Expressions Of Popular Piety - AP
- US Aircraft Carrier Carries More Firepower on Return to West Pacific - Newsweek
- Le Pen Salutes ‘Positive’ Talks After Meeting New French PM Bayrou - Politico
- French Parliament Avoids Government Shutdown By Passing Special Budget Rollover Bill – France 24
- Canada's Finance Minister Resigns, Citing Dispute With Trudeau - BBC
- China Races to Squelch Unrest as Signs of Economic Malaise Spread - WSJ
- How China’s Satellite Megaprojects Are Challenging Elon Musk’s Starlink - CNBC
- Taiwan Receives First Batch Of US-Made Abrams Tanks - VOA
- Billions Urgently Needed To Address World’s Hunger Hot Spots, Cindy McCain Says - Politico
- South Korean President Refuses Questioning Amid Martial Law Rebellion Probe – Newsweek
Policy and Politics
TikTok Files Emergency Appeal With Supreme Court To Block A US Ban Unless It's Sold
TikTok on Monday asked the Supreme Court to block a law that could potentially ban the video-based social media app, which has millions of American users. At issue is a bipartisan measure passed by Congress and signed into law by President Joe Biden that would go into effect on Jan. 19, the day before President-elect Donald Trump takes office, unless the justices intervene.
The law, called the Protecting Americans from Foreign Adversary Controlled Applications Act, would require TikTok's Chinese owner ByteDance to sell the platform to an American company or face a ban. TikTok has challenged the law, saying it violates the free speech rights of the company under the U.S. Constitution's First Amendment. "The Act will shutter one of America’s most popular speech platforms the day before a presidential inauguration," TikTok's lawyers wrote in the court filing. The federal government has defended the law on national security grounds, saying there are concerns about the Chinese government's influence over the app.
U.S. Congressional Negotiators Aim To Fund Government Through March 14, Source Says
Republican and Democratic negotiators in the U.S. Congress are closing in on a deal for a stopgap bill to fund the government through March 14, averting a partial shutdown that would otherwise begin Saturday, a source familiar with the talks said on Monday. The measure would likely keep the roughly $6.2 trillion federal budget running at its current level, funding everything from the military to air traffic controllers to federal securities regulators at their current level. It is expected to include an extension of the farm bill, an omnibus package passed every five years, a Republican Senate aide said.
Democrats had pushed for a longer bill, funding the government through the end of its current fiscal year, which ends Sept. 30. But Republicans balked, wanting to wait for final agreement until after President-elect Donald Trump is sworn in on Jan. 20 and their party takes its majorities in both the Senate and House of Representatives. Trump and congressional Republicans campaigned this year on a promise of significantly cutting the number of federal workers and proposing deep cuts to many of the government's programs.
Biden’s Student Loan Forgiveness ‘Plan B’ Is In Its ‘Last Step,’ Expert Says
With weeks to go before President-elect Donald Trump takes office, the Biden administration is still taking steps to deliver sweeping student loan forgiveness to millions of Americans. The U.S. Department of Education has submitted its so-called “Plan B” for student loan cancellation to the Office of Management and Budget for review. “OMB review is the last step” before the policy is published in the Federal Register, said higher education expert Mark Kantrowitz. Once the rule is published, the Education Department could begin reducing or eliminating people’s loans, Kantrowitz said.
President Joe Biden began working on his revised student loan relief plan after the Supreme Court blocked its first program in June 2023. The updated policy targets several groups of borrowers for relief, including those who’ve been in repayment for decades or attended schools that misled them. The Education Department may also try, in the last month under Biden, to clear the loans of those experiencing financial hardship through a second rule also under OMB review, experts say.
Health and Wellness
Holiday Health Check: Mental Health Struggles May Be Worse Right Now
As winter closes in and the holidays approach, it may seem like joy and fellowship are the norm. However, that is not always a reality. Winter can exacerbate preexisting mental health issues. Grief can be sharper and people may struggle more than usual during this time of year. In the health care industry, burnout is never very far away. It’s important to understand how workers may be feeling—and how you can help.
You might be wondering what you can do if your employees are struggling, especially if they have not been vocal about it. The first step is ensuring your company is structured for support. Darcy E. Gruttadaro, chief innovation officer at the National Alliance on Mental Illness (NAMI), recommends reviewing the company's benefits and checking that mental health support is as comprehensive as physical benefits. If you or another teammate notices concerning behavior for more than a few days, Gruttadaro recommends starting a conversation. This would also be a good time to remind the employee of available resources, such as an employee assistance program.
Read more at Homecare Magazine
Transition 2024
- 5 Takeaways From Trump’s Mar-A-Lago Press Conference – The Hill
- RFK Jr. Has a Battle Plan to Get Senate Confirmation - WSJ
- Hegseth Cabinet Nomination: Trump’s Pentagon Pick Will Release Accuser From NDA, Sen. Graham Says - Forbes
- Trump Transition Team To Roll Back Biden EV, Emissions Policies - Reuters
- Trump Girds For Battle With Democrats, Supreme Court Over Birthright Citizenship – The Hill
- Sam Altman Latest Tech Billionaire To Donate $1 Million To Trump Inaugural Fund—Joining Bezos, Zuckerberg - Forbes
- Federal Workers Brace For Change Amid Doge Rhetoric – The Hill
- Why Musk Doesn’t Have Access to SpaceX’s Biggest Government Secrets - WSJ
- Trump Downplays Possibility Of Desantis Appointing Lara Trump To The Senate - Politico
- Tracking Trump’s Cabinet Picks – Politico
Industry News
U.S. Finalizes $9.63 Billion Loan For Ford, SK On Joint Battery Venture
-The U.S. Energy Department on Monday said it has finalized a $9.63 billion loan to a joint venture of Ford Motor (F) and South Korean battery maker SK On to help finance construction of three new battery manufacturing plants in Tennessee and Kentucky. The final award - first reported by Reuters - is one of a series of actions by the Biden administration to boost electric vehicle production before President-elect Donald Trump takes office next month.
The low-cost government loan for the BlueOval SK joint venture is the largest ever from the government's Advanced Technology Vehicles Manufacturing loan program. SK On is the battery unit of energy group SK Innovation. BlueOval SK said it has invested more than $11 billion to date in the construction of the three 4-million-square-foot facilities and plans to begin production at the first Kentucky plant in 2025 and will be ready to begin production in Tennessee in late 2025.
Cocoa Hits Fresh Record in Blow to Chocolate Makers, Consumers
Cocoa futures reached a fresh record in New York as the market grapples with renewed supply concerns, heightening the odds that the high costs already plaguing chocolatiers and consumers will worsen. Prices for the crop soared earlier this year as weak harvests in West Africa — the major production hub — plunged the world into a third straight supply deficit. After cooling, the rally recently regained momentum as adverse weather further threatens the region’s farms, limiting the chance to rebuild already low global stockpiles.
The most-active contract rose as much as 4.1% on Monday to $11,768 a ton. Futures have more than doubled in 2024, forcing candy makers like Hershey Co. to boost prices. Cocoa’s supply challenges have been compounded by longstanding industry problems, including crop disease and a legacy of low farmer pay. Newly-planted trees also take a few years to bear pods, delaying a meaningful production rebound.
Inside Boeing’s Struggle To Make Its Best-Selling Plane Again
Since a crippling strike at many of Boeing's U.S. plane factories ended more than a month ago, progress ramping up production of its best-selling 737 MAX jet has been deliberately slow. Safety inspectors inside the 737 MAX factory outside Seattle laboriously scoured half-constructed planes for flaws they may have missed during the seven-week work stoppage. Other workers poured over manuals to restore their expired safety licenses. The result: no new 737 MAX plane has been completed. Boeing said on Tuesday that it had restarted MAX production last week, as first reported by Reuters.
After weeks of inertia, there were fresh signs of movement inside Boeing's Renton 737 MAX factory last week, three sources said, with green fuselages entering the final assembly line where the wings and tail get attached. Boeing executives have privately said they hope to produce 15 to 20 MAX jets this month, two of the 10 suppliers and one industry source said, although one of them cautioned that the chance of hitting the higher end of that target is unlikely. The Boeing spokesperson did not comment on those numbers.
Automotive Supplier Bosch Nabs $225M in CHIPS Funds
The Department of Commerce is offering up to $225 million in CHIPS and Science Act funding to automotive supplier Bosch, the agency announced Friday. The funding, which includes an additional $350 million in loans from the CHIPS Program Office, supports Bosch’s $1.9 billion project to expand its Roseville, California, facility for silicon carbide semiconductor production for the automotive industry. The project is expected to create up to 1,000 construction jobs and 700 manufacturing, engineering and research and development roles, according to the release.
The Roseville wafer fab was acquired by Bosch in August 2023 from TSI Semiconductors Corp., according to a Bosch press release. With the acquisition, Bosch vowed to significantly grow its global portfolio of SiC semiconductors by the end of 2030, according to the release. The location will be Bosch’s first semiconductor facility in the country and extend the auto supplier’s international semiconductor manufacturing network. Bosch launched a new spinoff company called Robert Bosch Semiconductor LLC for the transformation.
Read more at Manufacturing Dive
Fedex Plans Additional Surcharge Changes For 2025
FedEx is adding new surcharges and tweaking some existing fees next month, the delivery giant announced Friday. The company is introducing an inbound processing fee on U.S. imports and a duty and tax forwarding fee. It will also apply a 40-pound minimum billable weight for packages whose dimensions require an additional handling surcharge, mirroring UPS. FedEx will also levy a delivery area surcharge on several new ZIP codes.
The changes will take effect Jan. 13, 2025, one week after FedEx’s new rate and surcharge increases are implemented. The company said the net impact to each customer depends on the particulars of their shipping agreement. Both FedEx and UPS are relying on surcharges to improve profitability in an underwhelming demand environment, parcel pricing experts have told Supply Chain Dive. Paul Yaussy, director of parcel consulting at Shipware, said last month that this means many shippers will face 2025 price increases exceeding the upcoming 5.9% average rate hikes.
Read more at Supply Chain Dive
Space Force Marks 5 Years, Outlines Future Priorities
Chief of Space Operations Gen. Chance Saltzman outlined six foundational “Space Force truths” that define the service’s unique identity, emphasizing that space is a critical warfighting domain and how Guardians are uniquely suited to control it. While the Space Force has grown dramatically to nearly 15,000 military and civilian personnel in just five years, its senior leaders underscored the need for advancement across multiple focus areas, while celebrating its accomplishments.
The Combined Space Operations forum, or CSpO, represents a strategic approach to integrating allied space capabilities and developing shared strategies. As a forum of ten nations, it aims to expedite information sharing across its partners, including some NATO allies. In his role, Godfrey aims to shape the future of space operations by integrating international allies into the Space Force’s force design process.
Read more at American Machinist
Trump and SoftBank CEO to Unveil $100 Billion Investment in U.S.
Donald Trump and SoftBank Group CEO Masayoshi Son jointly announced Monday that SoftBank plans to invest $100 billion in U.S. projects over the next four years, according to a person involved in the event, as the president-elect seeks to project enthusiasm over his return to power. The Japanese internet and telecommunications company estimates that its U.S.-based investments will create 100,000 jobs focused on artificial intelligence and emerging technologies and plans to complete the work before Trump leaves office in 2029, the person said. Trump and Son are scheduled to appear together at Mar-a-Lago, Trump’s private Florida club. A SoftBank spokesman declined to comment.
Companies have at times struggled to follow through on their bold commitments to create jobs and invest in the U.S. In 2018, Trump traveled to Wisconsin for the groundbreaking of a liquid-crystal-display plant. Electronics maker Foxconn said at the time that it would invest $10 billion in the project and that it would create up to 13,000 jobs in the state. But the company later scaled back its plans, investing a fraction of the money and creating far fewer jobs than it promised.
Oil Slips As Lackluster Chinese Data Weakens Outlook For Demand
West Texas Intermediate edged 0.8% lower to settle below $71 a barrel, while Brent breached $74. China’s crude refining dipped to the lowest in five months in November, while apparent oil demand fell 2.1% year-on-year. China’s retail sales growth was well below estimates. The data “demonstrates how easily crude spooks itself lower,” said Rebecca Babin, senior energy trader at CIBC Private Wealth Group. Traders expect choppy trading in the last full week before markets pause for end-of-year holidays.
Providing some support for prices, the European Union sanctioned 52 additional tankers that predominantly ship Russian crude, according to an official list published Monday morning. Traders remain uncertain about what a Donald Trump presidency will mean for prices, with possible tariffs threatening to weaken demand while the potentially tighter enforcement of sanctions on Iran may curb supplies.
The New Frontier for Drone Warfare Is Deep Underwater
Drones have revolutionized modern warfare in the sky. Now defense companies and navies are betting they can do the same underwater. The new underwater drones, with names such as Ghost Shark, Herne and Manta Ray, can typically dive thousands of feet below the surface and operate largely without human interaction for days on end. That ability makes them ideally suited to gather intelligence, protect undersea infrastructure and counter potential threats in the Pacific, advocates say.
Underwater drones have been used by academics and offshore energy companies for decades. An underwater drone found Titanic in 1985, for example. Navies have also long used smaller—typically remote-controlled—underwater vessels for mine clearance and other tasks. Now, defense companies are developing larger, more autonomous vessels that can travel longer distances and do more. Adm. Lisa Franchetti, chief of naval operations, has said developing robotic and autonomous systems is one of the U.S. Navy’s top priorities in preparing for a possible war with China.