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Member Briefing December 4, 2024

December 4, 2024

Posted By: Harold King in Daily Briefing,

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JOLTS Survey Continues To Show Labor Market Strength - Job Openings Rise, Layoffs Fall

U.S. job openings increased solidly in October while layoffs dropped by the most in 1-1/2 years, suggesting the labor market continued to slow in an orderly fashion. But the Job Openings and Labor Turnover Survey, or JOLTS report, from the Labor Department on Tuesday also showed employers hesitant to hire more workers. The historically low level of layoffs is anchoring the labor market and the broader economy through higher wages that are driving consumer spending. There were 1.11 job openings for every unemployed person in October, up from 1.08 in September. This ratio, which peaked at 2.03 in early 2022, is now below the 1.2 that prevailed before the COVID-19 pandemic. Workers also grew more confident in the labor market, with resignations posting their largest increase in nearly 1-1/2 years.

Job openings increased 372,000 to 7.744 million in October

Hires decreased 269,000 to 5.313 million

Layoffs dropped 169,000, the most since April 2023

Resignations increased 228,000 to 3.326 million

Read More at Reuters

Cyber Monday Spending Hits Record $13.3B

According to the latest Adobe Analytics data, spending climbed 7.3% compared with the same period a year ago, and surpassed its expectation of $13.2 billion. In the final hours of the shopping day, consumers spent $15.8 million every minute as they capitalized on larger-than-expected discounts. Usage of buy now, pay later services has also hit a record on Cyber Monday, accounting for $991.2 million in total spending, up 5.5% compared with the same time a year ago.

The Monday after Thanksgiving remains the biggest online shopping day of all time, according to Adobe. The strong holiday sales so far this season have demonstrated households’ capacity to spend even with inflation slightly higher than the Federal Reserve's 2% target. So far this holiday season, from Nov. 1 to Dec. 2, consumers have collectively spent $131.5 billion online, a 9% jump compared with the same period a year ago. More than half of all spending online has notably been driven by three categories, including electronics, apparel and furniture.

Read More at Fox Business

Tales from the Transcripts: Labor and Supply Chain Worries Resurface Among Manufacturing CEOs

Vigilance and discipline remain watchwords in the industrial sector, IndustryWeek’s latest analysis of the earnings call transcripts of 50 prominent U.S.-based manufacturers shows. Three months ago, Tales From The Transcript—our deep dive into the quarterly earnings calls from leading names in 10 sectors of the IndustryWeek U.S. 500 list of the largest public manufacturing companies—focused on the level of uncertainty many leadership teams discussed heading into fall.

This time around, our scores tracking forward-looking statements about demand, the supply chain, inflation and the labor market again came in far closer to neutral than in 2022 and 2023, suggesting the uncertainty—and the focus on discipline it is spurring—will endure even if there are new signs of optimism about 2025. The scores and summaries below reflect calls held from late September to the third week of November. As always, we’ve arranged them from most negative to most positive.

Read more at Industry Week

Global Headlines

Middle East

Ukraine

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Policy and Politics

Rockefeller Institute Releases Eagerly Awaited Study On Reforming Education Formula Funding In New York

The Rockefeller Institute of Government on Monday released a highly anticipated reassessment of the Foundation Aid formula, the primary formula New York state uses to fund public schools. The report was a compromise as part of budget negotiations earlier this spring after Gov. Kathy Hochul set the stage by insisting on ending Save Harmless, also known as "hold harmless," which ensures districts don’t receive less Foundation Aid funding than the previous year, even if their population decreases. Legislative and education leaders pushed back, and advocated for a study of the outdated formula instead. The recommendations include:

Phasing out 50% of "save harmless" over five years as Foundation Aid formula reforms are made; some districts would eventually not be eligible for Save Harmless

Allowing districts to increase their unrestricted year-end fund balance to 10%

Replacing the current out-of-date poverty measure with an annually updated federal measure

Scaling aid for students with disabilities based on their level of need

Eliminating the $500 per pupil flat grant, and proposing the $41 million that would be saved by the elimination to wealthy districts be reallocated through the general Foundation Aid formula

According to the Rockefeller Institute, the report should be considered “a menu of options for policy makers to consider,” with the possibility of phased-in changes so no districts see a large year-to-year change in funding.

Read more at NY State of Politics

Read the Report

Trump Repeats Vow To ‘Block’ Nippon Steel’s Bid For U.S. Steel

U.S. President-elect Donald Trump has pledged to block Japanese company Nippon Steel’s planned purchase of U.S. Steel. “I am totally against the once great and powerful U.S. Steel being bought by a foreign company, in this case Nippon Steel of Japan,” Trump said in a post on his social media platform Truth Social on Monday night Eastern time. “As President, I will block this deal from happening,” he said, adding that he will make U.S. Steel “Strong and Great Again” through the use of tax incentives and tariffs. The Committee on Foreign Investment in the U.S., which examines possible national security risks of transactions by foreign entities, has been reviewing the deal.

While he made similar statements on the 2024 campaign trail, it was the first time that Trump had spoken about the deal since he won a second presidential term last month. Nippon Steel, the fourth-largest global steelmaker, reached an agreement to acquire U.S. Steel last December. However, the deal encountered opposition from the United Steelworkers, a prominent labor union, as well as U.S. President Joe Biden, who has vowed that U.S. Steel will remain American-owned. U.S. Steel has an annual production capacity of around 20 million metric tons, while Nippon Steel is the leading steel producer in Japan. Together, the two companies would have a total capacity of up to 86 million tons.

Read more at CNBC

Appointments Set Off Special Elections To Fill House Seats: What To Know

The move by President-elect Trump to tap several House Republicans to fill positions in his Cabinet and beyond has set off a fresh round of special elections next year to replace them. Trump chose Reps. Mike Waltz (R-Fla.) and Elise Stefanik (R-N.Y.) to be his national security adviser and U.S. ambassador to the United Nations, respectively. The president-elect also tapped former Rep. Matt Gaetz (R-Fla.) to be his attorney general, though Gaetz later withdrew from being considered amid concerns over Senate holdouts. Gaetz, however, decided against returning to Congress.

New York Rep Elise Stefanik has not yet resigned from Congress or publicly outlined when she expects to officially step down. Her role requires Senate confirmation. Among the names that have been floated as potential candidates include Rep. Marc Molinaro (R-N.Y.), who lost reelection New York’s 19th Congressional District last month; Assembly Members Chris Tague and Robert Smullen; and state Sen. Dan Stec, among others, according to Spectrum News 1. Cannabis tax attorney Paula Collins, the who lost to Stefanik last month in the 2024 general election, has thrown her name in the ring on the Democratic side.

Here’s a look at what to know about the upcoming special elections for each of the other outgoing or former lawmakers.

Read more at The Hill

Health and Wellness

Major Cucumber Recall Expands To 35 States Over Salmonella Concerns—68 Illnesses Reported So Far

In an update on Monday, the U.S. Food and Drug Administration said the cucumber recall has been expanded to add produce from two more companies: Baloian Farms and Russ Davis. Another company, SunFed Produce, issued a voluntary recall of cucumbers over salmonella concerns last week. According to the FDA, the affected produce was grown by Agrotato in Sonora, Mexico, and importers sold them to the three companies between October 12 and November 26.

The recall now covers cucumbers sold in 35 states (including New York, Connecticut and New Jersey) and five provinces of Canada. According to the FDA, 68 people across 19 states have been sickened by the salmonella outbreak linked to the cucumbers, 18 of whom have been hospitalized, but no deaths have been reported. Last week, 10,000 cartons of organic eggs sold at Costco—sourced from New York’s Handsome Brook Farms—were also recalled over salmonella concerns.

Read more at Forbes

Transition 2024

Industry News

Holiday Supply Chain - Christmas Tree Farmers Haven’t Had It This Hard in Years

Root rot. Scant labor. Foreign competition. Inflation on everything from seeds to tractors. And that was before Hurricane Helene wreaked havoc on the western part of North Carolina, which produces more Christmas trees than any state except Oregon. “It’s the hardest year ever in North Carolina agriculture,” said Lee Wicker, deputy director of the North Carolina Growers Association. “The damage from Helene had a compounding effect. It wasn’t one single thing, it was all these things that happened.”

Delivering one of the most popular Christmas tree varieties, Fraser firs, to tree lots in recent weeks fulfilled the Christmas wish of many North Carolina growers. One out of four Fraser firs sold nationally—and virtually all Fraser firs sold on the East Coast—comes from western North Carolina. The area was devastated by flooding that left 95 people dead, washed out roads and destroyed homes, including that of tree farmer Waightstill Avery III. Avery, 58, also lost a barn, an office, hauling trailers, dump trucks and—worst of all—60,000 trees, a third of the total at family-owned Trinity Tree Company-Avery Farms. Many of the damaged trees were partially submerged by floodwater. Others were covered in clingy silt that resists washing. Avery’s staff, which includes his adult sons, have been recovering what they can, cutting tree tops off for table displays and using any salvageable greenery to make 3,000 wreaths, twice the normal number.

Read more at The WSJ

Space Firms Plot New European Satellite Venture To Take On Starlink As Job Cuts Loom

Europe's Airbus, Thales and Leonardo are exploring plans to set up a new joint space company as they look to compete with Elon Musk's Starlink. “Project Bromo", named after an Indonesian volcano, envisages a standalone European satellite champion modelled on missile maker MBDA, which is owned by Airbus, Leonardo and BAE Systems three people familiar with the matter said. Although still at an early stage, talks have progressed far enough to earn a code-name inside Airbus and a preferred structure with a new company combining satellite assets, rather than one partner buying assets from the rest, the people said.

Europe's top satellite makers have traditionally focused on complex spacecraft in geostationary orbit but have been hit by the arrival of cheap tiny satellites in low Earth orbit. Cingolani said satellites would become 75% of the space economy. Talks to reshape the industry's long-term structure come as thousands of Airbus workers await details of space and defence job cuts to be presented to unions on Wednesday and Thursday.

Read more at Reuters

Watch: How Jaguar's Shifted Gears With Its Concept Car

Concept images of what appears to be British luxury vehicle company Jaguar’s upcoming electric vehicle leaked online Monday morning hours before its planned release, multiple automotive publications reported, following weeks of controversy over the company’s colorful rebrand. British automotive publication AutoCar published pictures of the supposed concept car Monday morning, stating they were first posted to the car forum Coche Spias, calling it “completely unrelated to any Jaguar model that has gone before.”

The concept images depict a bright pink vehicle with a more minimalist design, featuring an oval-shaped steering wheel, a wide front grill and no rear window, suggesting cameras may be used to show drivers the road behind them. The Jaguar emblem, which the company had said would be reimagined, is located on a gold plate next to the front left wheel, a departure from previous designs that have featured a roaring jaguar on the front grill, a leaping jaguar on the back of the vehicle and a jaguar hood ornament.

Read more at The BBC

Hyundai Motor America Reports Record-Breaking November 2024 Sales

Hyundai Motor America reported record-breaking total November sales of 76,008 units, an 8% increase compared with November 2023. Hyundai set total sales records in November for Santa Fe HEV (+64%), Tucson PHEV (+23%), Tucson HEV (+227%), IONIQ 5 (+110%) and Elantra N (+140%), Hybrid vehicle total sales jumped 114%, while total EV sales grew 70%. This was the best-ever month for Santa Fe HEV, Tucson PHEV, Tucson HEV and IONIQ 5. Retail sales for November 2024 set new records climbing 15%. EV retail sales increased 77% year-over-year, hybrid retail sales grew by 104% and electrified (EV, hybrid, plug-in hybrid) retail sales jumped 92%.

"Hyundai delivered an exceptional sales month, driven by the strong performance of our EV and hybrid vehicles," said Randy Parker, CEO of Hyundai Motor America. "Customers continue to be attracted to Hyundai's diverse vehicle lineup which can meet a variety of customer needs. We also saw significant interest and excitement for the worldwide debut of the U.S.-built IONIQ 9 and we can't wait to bring it to market next year."

Read more at Yahoo Finance

Tesla CEO Elon Musk's $56B Pay Package Rejected By Delaware Judge

Tesla CEO Elon Musk on Monday lost his bid to get his 2018 CEO pay package reinstated when a Delaware judge upheld her prior ruling that the compensation plan was improperly granted. The package, worth about $56 billion, was the largest compensation plan in U.S. history for a public company executive. Tesla said in a post on social media platform X, which Musk owns, that it plans to appeal the ruling. Musk, in a separate X post, called the ruling “absolute corruption.”

In January, Chancellor Kathaleen McCormick voided the pay plan, ruling that Musk had individually “controlled Tesla” and dictated the terms of his compensation to a board that didn’t fairly negotiate. She called the process leading to approval of that pay plan “deeply flawed.” Following the opinion, Tesla conducted a shareholder vote in June at its annual meeting in Austin, Texas, asking investors to “ratify” Musk’s 2018 CEO pay plan. Musk’s attorneys attempted to sway the judge to reverse her opinion after the trial, leaning on the results of that vote. “Even if a stockholder vote could have a ratifying effect, it could not do so here,” McCormick wrote in her opinion Monday. “Were the court to condone the practice of allowing defeated parties to create new facts for the purpose of revising judgments, lawsuits would become interminable.”

Read more at CNBC

Pentagon Moves To Speed Acquisitions With CUPID

There are a lot of reasons why it takes more than two years to build the annual Defense budget. But one of them is the fact that DoD’s acquisition systems and its financial management systems don’t talk to each other — at least not very well. That’s a problem the Pentagon is starting to solve though as programs big and small begin to coalesce around a common lexicon, and officials are hoping for some big management gains thanks to that added visibility. The new approach, called the Centralized Unique Program Identifier (CUPID) is a partial answer to one of the key problems the Congressional commission on Planning, Programming, Budgeting and Execution (PPBE) identified in its final report: DoD’s complex and aging web of business systems doesn’t make it easy to share information about how the budget is being executed across different parts of the department, let alone with Congress.

DoD started using CUPID for acquisition data all the way down to contract line item numbers earlier this year, when the department implemented a new rule requiring contracting officers to tag each reportable action they take on contracts with the three-digit CUPID code that contract supports. And in theory, every program in DoD now has one of those codes, because program managers are now required to register them in the department’s Defense Acquisition Visibility Environment (DAVE).

Read more at Federal News Network

Amazon Announces Supercomputer, New Server Powered by Homegrown AI Chips

Amazon’s cloud computing arm Amazon Web Services Tuesday announced plans for an “Ultracluster,” a massive AI supercomputer made up of hundreds of thousands of its homegrown Trainium chips, as well as a new server, the latest efforts by its AI chip design lab based in Austin, Texas. The chip cluster will be used by the AI startup Anthropic, in which the retail and cloud-computing giant recently invested an additional $4 billion. The cluster, called Project Rainier, will be located in the U.S. When ready in 2025, it will be one of the largest in the world for training AI models, according to Dave Brown, Amazon Web Services’ vice president of compute and networking services.

Amazon Web Services also announced a new server called Ultraserver, made up of 64 of its own interconnected chips, at its annual re:Invent conference in Las Vegas Tuesday. Additionally, AWS on Tuesday unveiled Apple as one of its newest chip customers. Combined, Tuesday’s announcements underscore AWS’s commitment to Trainium, the in-house-designed silicon the company is positioning as a viable alternative to the graphics processing units, or GPUs, sold by chip giant Nvidia. The market for AI semiconductors was an estimated $117.5 billion in 2024, and will reach an expected $193.3 billion by the end of 2027, according to research firm International Data Corp. Nvidia commands about 95% of the market for AI chips, according to IDC’s December research.

Read more at The WSJ

Map Shows U.S. States with the Highest Unemployment Rates

The onset of the COVID pandemic and subsequent imposition of nationwide lockdowns forced "nonessential" businesses to close their doors. Many workers, especially in sectors demanding physical presence, were unable to work remotely, and these factors together drove the national unemployment rate to an unprecedented 14.8 percent in April of 2020. While the job market has since recovered to nearly pre-pandemic levels—the national unemployment rate is currently 4.1 percent according to the Bureau of Labor Statistics—deeper-level trends like an aging population, the rise of automation and the long-term decline of U.S. manufacturing have exerted, and will continue to exert, significant sway over joblessness in the U.S.

While unemployment affected the entire nation during the pandemic, not every state was able to endure its impact or recover as effectively, resulting in significant disparities in rates across the U.S. Using data from the Bureau of Labor Statistics, compiled by the Federal Reserve Bank of St. Louis, Newsweek has created a map showing unemployment rates across the U.S. as of October 2024.

Read more at Newsweek

Meet The Forbes Under 30 Class Of 2025

For the visionaries featured in the 14th annual Forbes 30 Under 30 class, the only constant is change—and this year we’re changing the way we list them as well. Every company is a tech company now, so we swapped out the Enterprise and Consumer Tech categories for AI and Transportation. What hasn’t changed: The outsize influence of 2025’s Under 30 honorees. They’re inventing new tech to treat tumors, expanding access to electric vehicle charging, making credit cards more secure, and even dreaming of reflective satellites that could bring the sun out at night.

To identify this standout group, Forbes editors worked with expert judges—including musician Big Sean, journalist Kara Swisher, America's richest self-made woman Diane Hendricks, ballerina Misty Copeland, and billionaire venture capitalist Jim Breyer, among others—to review more than 10,000 candidates, evaluating them on impact, financials and creativity. The result: 600 young leaders steering the future of business and culture in 20 different industries.

Read more at Forbes

Member Briefing December 3, 2024December 3, 2024