Member Briefing January 17, 2023
NFIB: Small Business Optimism Declines
The NFIB Small Business Optimism Index declined 2.1 points in December to 89.8, marking the 12th consecutive month below the 49-year average of 98. Owners expecting better business conditions over the next six months worsened by eight points from November to a net negative 51%. Inflation remains the single most important business problem with 32% of owners reporting it as their top problem in operating their business.
Key findings include:
- Forty-one percent of owners reported job openings that were hard to fill, down three points from November but historically very high.
- The net percent of owners raising average selling prices decreased eight points to a net 43% (seasonally adjusted), historically high.
- The net percent of owners who expect real sales to be higher worsened two points from November to a net negative 10%.
War in Ukraine Headlines
- Ukraine and Russia: The Latest News – The Guardian
- Russian Exercises With Belarus Spark Concerns in Ukraine – The Hill
- Russia’s Energy Clout Is Waning, Weakening Its Global Influence - WSJ
- Germany’s Defense Minister Resigns Amid Ukraine Criticism – Defense News
- Dozens of Russian Draftees Died in a Ukrainian Strike and Putin’s War Machine Rolled On - WSJ
- Russia Produces First Nuclear Warheads for Poseidon Super Torpedo – TASS – Reuters
- Russia Hit Dnipro With 'Carrier Killer' Missile Made To Destroy Ships: Kyiv - Newsweek
- Death Toll Rises to 40 in Russian Strike on Ukrainian Apartment Building – The Hill
- Russia's Falling Oil Revenues Could Create Vicious Circle for Budget, Rouble
- Will the Ukraine War Slow Russia’s Arctic Push? – Defense News
- Map – Tracking Russia’s Invasion of Ukraine – Live Universal Awareness Map
Manufacturing Technology Orders Down Nearly One-Third in November
New orders of manufacturing technology totaled $436.5 million in November 2022, according to the latest U.S. Manufacturing Technology Orders Report published by AMT-The Association For Manufacturing Technology. November 2022 orders were down 4.5% from October 2022 and down nearly 32% from November 2021. Year-to-date orders dropped below 2021 for the first time in 2022, dipping 3.7% below the total through November 2021.
In an environment of rapidly rising interest rates, home construction and renovation has slowed, and manufacturers of household appliances have continued to reduce their orders through November 2022. Likewise, declining investments in capital goods by manufacturers of HVAC and commercial refrigeration reflect slowing demand from commercial construction
Read more at Manufacturing.Net
Global Recession in 2023 Seen as Likely in World Economic Forum Survey
Two-thirds of private and public sector chief economists surveyed by the World Economic Forum (WEF) expect a global recession in 2023, the Davos-organiser said on Monday as business and government leaders gathered for its annual meeting. Some 18% considered a world recession "extremely likely" - more than twice as many as in the previous survey conducted in September 2022. Only one-third of respondents to the survey viewed it as unlikely this year.
On inflation, the WEF survey saw large regional variations: the proportion expecting high inflation in 2023 ranged from just 5% for China to 57% for Europe, where the impact of last year's rise in energy prices has spread to the wider economy. A majority of the economists see further monetary policy tightening in Europe and the United States (59% and 55%, respectively), with policy-makers caught between the risks of tightening too much or too little.
U.S. COVID – Experts: ‘People Aren’t Taking This Seriously’
In the fourth year of the pandemic, Covid-19 is once again spreading across America and being driven by the recent holidays, fewer precautions and the continuing evolution of Omicron subvariants of the virus. New sub-variants are causing concern for their increased transmissibility and ability to evade some antibodies, but the same tools continue to curtail the spread of Covid, especially bivalent boosters, masks, ventilation, antivirals and other precautions, experts said.
New Covid hospital admissions are now at the fourth-highest rate of the pandemic, according to the US Centers for Disease Control and Prevention (CDC). The majority of Covid hospitalizations are among those 65 and older. In the past week, Covid deaths rose from 2,705 in the week ending 4 January to 3,907 in the week ending 11 January.
NYS COVID Update
The Governor updated COVID data through January 13.
Deaths:
- Daily: 30
- Total Reported to CDC: 77,325
Hospitalizations:
- Patients Currently in Hospital statewide: 3,518
- Patients Currently in ICU Statewide: 358
7 Day Average Positivity Rate - Cases per 100K population
- Statewide 6.75% - 25.85 positive cases per 100,00 population
- Mid-Hudson: 7.04% - 22.03 positive cases per 100,00 population
Useful Websites:
Pfizer Bivalent Vaccine Linked to Strokes in Preliminary Data
The CDC, in a statement posted to its website Friday, said a surveillance system called the Vaccine Safety Datalink detected a possible risk for stroke in people ages 65 and older who received the Pfizer booster shot targeting the omicron Covid variant. A CDC spokesperson said this issue was first detected in late November. By mid-December, the CDC concluded the concern was persisting and launched an investigation into whether seniors are more likely to have a stroke in the first 21 days after receiving the Pfizer booster, the spokesperson said. A similar preliminary signal was not detected for Moderna’s booster.
In a statement Friday, Pfizer said there is no evidence to conclude that ischemic stroke is associated with company’s Covid vaccine. Neither Pfizer and its German partner BioNTech, nor the CDC or the FDA, have observed such an association in numerous other monitoring systems in the U.S. and globally, company spokesperson Kit Longley said.
China’s Spike in COVID-19 Cases Strains Factories
For nearly three years, one of the most dreaded possibilities among China-based manufacturers was if workers contracted COVID-19. Under the country’s stringent zero-COVID policy, even a few positive cases in or around a factory could shut down an entire operation for days. But in the last several weeks, the script has flipped. The Chinese government began lifting its zero-COVID policy last month, easing travel restrictions and ending mandatory quarantine measures for those infected.
The change led to a sharp spike in cases. Between the week of Dec.19 and the week of Dec. 26, cases rose more than 67% in the country, with more than 251,000 confirmed cases that week alone, according to the World Health Organization. With so many people falling ill so quickly, many factories throughout the country found themselves short staffed and struggling to maintain normal operations.
Read more at Supply Chain Dive
Household Wealth Optimism Collapses, Global Survey Shows
Barely two in five people believe their families will be better off in the future, according to a regular global survey that also identified growing levels of distrust in institutions among low-income households. The Edelman Trust Barometer, which for over two decades has polled the attitudes of thousands of people, found that economic pessimism was at its highest in some of the world's top economies such as the United States, Britain, Germany and Japan.
Globally, only 40% agreed with the statement "my family and I will be better off in five years" compared to 50% a year before, with advanced economies most downbeat: the United States (36%), Britain (23%), Germany (15%) and Japan (9%).
China Braces for Covid Surge as Lunar New Year Travel Rush Begins
Passengers flocked to railway stations and airports in China’s megacities on Monday, heading home for holidays that health experts fear could intensify a Covid-19 outbreak that has claimed thousands of lives. After three years of strict and suffocating anti-virus controls, China in early December abruptly abandoned its zero-Covid policy, letting the virus run freely through its population of 1.4 billion.
Ahead of the lunar new year holidays, also known as the spring festival, which officially starts on 21 January, state media has been filled with stories of rural hospitals and clinics bolstering their supplies of drugs and equipment.
Now Open: FuzeHub Manufacturing Grants 2023 Round 1
The Jeff Lawrence Innovation Fund Manufacturing Grants are designed to encourage collaboration between not-for-profit organizations and small to medium-sized manufacturing companies in New York State. The grants serve as a resource to help companies achieve success from early stage, proof of concept through maturity. The partnership created by the not-for-profit organization and the industry partner serves as a pathway to technology transfer, adoption and implementation of new manufacturing processes, as well as the creation of enhanced products and services.
If you have questions about the application process, please reach out to Patty Rechberger, Fund Manager, at patty@fuzehub.com. Applications for the first round of 2023 Manufacturing Grants close February 15 at 4 PM EST.
Multinational Companies Still Want Cheap and Efficient Markets, But They Also Want Safety
For decades, multinational companies sought out cheap, efficient supply chains to produce goods for global export, in addition to access to growing young populations in developing countries to spur sales. They operated on the assumption that security and political tensions between countries wouldn’t obstruct their operations. That led many of them to China. These companies are still looking for cheap, efficient and young markets. But now they also want safety, which for many has meant diversification away from direct tension between the world’s great economic powers.
In other words, global economic ties haven’t ended; they are being rerouted, with widespread implications. The efficiencies lost mean higher costs for households and businesses, and profit-margin pressure for companies. In boardrooms, it means more attention needs to be paid to risk and a widening landscape of potential crises. For politicians, it will accentuate the struggle to balance economic growth and low inflation against the demand to defend national interest.
IMF Warns Unraveling Economic Ties Could Shrink Global Output
Declining international cooperation and commerce could shrink the global economy, particularly harming low-income countries, the International Monetary Fund said in a new study. The report cited several ways that government policies are driving a reversal of global economic integration, such as by restrictions on trade, immigration and cross-border capital flows. The authors labeled this process geoeconomic fragmentation and warned it could lower global gross domestic product by up to 7% over an unspecified “long-term” period.
The lMF said that the U.S., European Union and China had all enacted recent measures to promote domestic high-tech production. Companies, too, were moving their supply chains to minimize risk, with key words such as “reshoring,” “near-shoring” and “onshoring” appearing more frequently in company earnings calls and reports, the IMF said.
Global Employment Growth to Drop 2023 Due to Economic Fallout: ILO
Global employment growth is expected to slow down sharply to 1 percent this year compared to 2 percent in 2022, hit by the economic fallout of the war in Ukraine, high inflation and tighter monetary policy, the International Labor Organization (ILO) said on Monday. “The slowdown in global employment growth means that we don’t expect the losses incurred during the COVID-19 crisis to be recovered before 2025,” said Richard Samans, Director of the ILO’s Research Department and coordinator of its newly published report.
At the same time, the number of unemployed people in the world is expected to rise by 3 million to 208 million in 2023, while inflation will eat into real wages, the ILO said in a report on global trends.
Boeing Orders Rise to 4-Year High, Still Trail Airbus
Boeing took more than 200 net orders for passenger airplanes in December to complete its best year since 2018, but it failed again to catch up with European manufacturer Airbus in orders and aircraft deliveries. Airbus reported Tuesday that it took orders for 820 planes in all of 2022, after subtracting cancellations, and it delivered 661 to airlines and other customers. Those numbers topped Boeing's 774 orders and 480 deliveries.
The battle for supremacy in aircraft manufacturing has been a one-sided affair in recent years, as Boeing was dragged down by two deadly crashes of its best-selling plane, the 737 Max, and with production flaws that halted shipments of a larger plane, the 787. The latest numbers showed Boeing closing the gap, however.