Member Briefing March 11, 2024
All About Jobs 1: U.S. Job Growth Totaled 275,000 in February, December and January Revised Lower
Nonfarm payrolls increased by 275,000 for the month while the jobless rate moved higher to 3.9%, the Labor Department’s Bureau of Labor Statistics reported Friday. Economists surveyed by Dow Jones had been looking for payroll growth of 198,000. February was a step higher in growth from January, which saw a steep downward revision to 229,000, from the initially reported 353,000. Job growth in December also was revised down to 290,000 from 333,000, bringing the two-month total to 167,000 fewer jobs than initially reported.
The labor force participation rate held steady at 62.5%, though the “prime age” rate increased to 83.5%, up two-tenths of a percentage point. Average hourly earnings, watched closely as an inflation indicator, showed a slightly less than expected increase for the month and a deceleration from a year ago. Wages rose just 0.1% on the month, one-tenth of a percentage point below the estimate, and were up 4.3% from a year ago, down from the 4.5% gain in January and slightly below the 4.4% estimate. Hours worked rebounded from a slip in January, with the average work week up to 34.3 hours, an increase of 0.1 percentage point.
All About the Jobs 2: NFIB Survey: Small Business Employment Slows to Fall
According to NFIB’s monthly jobs report, 37% (seasonally adjusted) of all owners reported jobs openings they could not fill in the current period, down two points from January and the lowest reading since January 2021. The percent of small business owners reporting labor quality as their top small business operating problem declined five points from January to 16%, the lowest reading since April 2020. Owners’ plans to fill open positions continue to slow, with a seasonally adjusted net 12% planning to create new jobs in the next three months, down two points from January and the lowest level since May 2020. Labor costs reported as the single most important problem for business owners increased one point to 11%, only two points below the highest reading of 13% reached in December 2021
“Job openings among small businesses decreased in February to pre-pandemic levels,” said NFIB Chief Economist Bill Dunkelberg. “Employment activity has lessened somewhat as it becomes easier for owners to find qualified workers. Even with this slowdown, labor demand remains strong.”
All About the Jobs 3: Hudson Valley Private Sector Job Growth Rises Led By Education and Health Services. Mfg Declines
Private sector jobs in the Hudson Valley increased by 10,400 or 1.3 percent, to 801,300 in the 12 months ending January 2024. Gains were greatest in private education and health services (+8,400), leisure and hospitality (+3,500), financial activities (+1,400), other services (+500), information (+200) and professional and business services (+200). Losses were centered in trade, transportation and utilities (-2,300), mining, logging and construction (-900) and manufacturing (-600). The region’s private sector job count continued to trend upward, reaching 801,3000 – its highest January employment count on record. Three sectors posted year-over-year growth of at least 3.1 percent.
Statewide private sector jobs increased by 119,000 for the 12 months ending January 2024. For the month of January employment actually fell by 189,000. Statewide manufacturers lost 4,800 jobs during the 12 months ending January 2024. For the month of January manufacturing employment fell by 5,200.
Global Headlines
Middle East
- Israel and Hamas: The Latest News – The Guardian
- Hamas Leaders Stick to Hard Line on Gaza Talks - WSJ
- Leading NGOs Slam Israel’s Halt in Visa Renewals for Aid Workers in Gaza and West Bank - AP
- Gaza Aid Ship Waiting to Sail from Cyprus as Charity Builds Jetty – Reuters
- Biden Warns of ‘Red Line’ for Israel Over Rafah - Politico
- Netanyahu Vows to Defy Biden’s ‘Red Line’ and Invade Rafah – Politico
- US, UK and French Destroy Dozens of Houthi Drones - BBC
- In Gaza, is Palestinian History Repeating Itself? – CS Monitor
- 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
- Russia’s Economy Once Again Defies the Doomsayers – The Economist
- A Globe-Trotting YouTube Influencer Led Indian Job-Seekers to Russia’s War - WSJ
- Is Europe Doing Enough to Help Against Russia? - BBC
- Pope Says Ukraine Should Have the ‘Courage of the White Flag’ - NYT
- Pope Francis Criticized for Ukraine 'White Flag' Remarks - DW
- Moldova Signs Defence Pact with France Amid Russia Fears – Reuters
- The EU’s Carbon Tax May Devastate a Country it is Trying to Keep Alive: 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
- Ireland: Voters Reject Amendments Redefining Family, Women - DW
- More Chinese Women Choosing Singledom as Economy Stutters - Reuters
- Chaos in Haiti Leaves U.S. With Few Options - WSJ
- Iran is Responsible for the ‘Physical Violence’ that Killed Mahsa Amini in 2022, UN Probe Finds - AP
- US Military Evacuates Staff, Adds Security at Embassy in Haiti - Politico
- Rwanda's Ruling Party Again Choses Kagame as Presidential Candidate – France 24
- Portugal Election: Centre-Right Set to Win, Far-Right Soars - Reuters
- Portugal Votes in Election Where Far Right Could Play Kingmaker - BBC
- IMF Backs New Pakistan Programme, Urges Electoral Row Resolution - Reuters
Policy and Politics
NAM: Biden ‘Missed the Mark’ on Manufacturing in State of the Union
Following President Biden’s State of the Union address, National Association of Manufacturers President and CEO Jay Timmons released the following statement: “Tonight, President Biden celebrated manufacturing’s accomplishments during his presidency, and rightly so. He signed into law some of the most consequential pro-manufacturing legislation in recent years—the Bipartisan Infrastructure Law, the CHIPS and Science Act and even key provisions of the Inflation Reduction Act. What’s more, manufacturers have stood proudly with him in his efforts to champion democracy abroad…
“But President Biden missed the mark tonight in several key areas when he laid out his plans going forward. If the cost of manufacturing in America is driven up by his agencies’ continued regulatory onslaught and a successful push to raise taxes, investment will be driven overseas and Americans will be driven out of work. If his campaign to ‘march-in’ to manufacturers and seize their intellectual property advances, it will rob Americans and the world of future cures and chill research into new breakthroughs across the manufacturing industry. And if President Biden continues to heap blame on pharmaceutical manufacturers, rather than reining in pharmacy benefit managers with cost-saving reforms, Americans and their employers will continue to endure rising health care costs.”
New York State Legislature’s One-House Budgets are Coming Today
Both houses of the state Legislature are planning to introduce their one-house budget proposals today, Monday 3/11, then pass them sometime before they adjourn for the week on March 14. That will frame the debate around the $233 billion spending plan proposed by Gov. Kathy Hochul as lawmakers ramp up talks over the product due on March 31 — but which will likely come at least a little late due to the overlap of that date and Easter.
Senate Majority Leader Andrea Stewart-Cousins indicated the Senate will propose changes to Hochul’s proposal to decrease funding for 337 school districts — despite the budget plan including a nearly 3 percent increase in overall education aid. School aid expects to be one of the most contentious issues as the sides negotiate in earnest in the coming weeks. Other subjects might face longer odds to make it into the one-houses. Both houses — particularly the Assembly — are historically a bit more reluctant than the governor to include policy items in the budget.
Senate Passes, Biden Signs Government Funding Bills to Avoid Partial Shutdown
President Biden on Saturday signed the government spending legislation to keep an array of federal departments open, as lawmakers turn their focus to the remaining appropriations bills. Biden signed the $460 billion package of six spending bills, which passed the Senate earlier Friday. The package funds military construction, water development and the departments of Veterans Affairs, Agriculture, Commerce, Justice, Energy, Interior, Transportation, and Housing and Urban Development.
The Senate voted 75-22 Friday evening to pass the bill. Their approval capped off weeks of tough bipartisan, bicameral funding talks, which began to pick up at the start of the year. The legislation passed the House 339-85, with 207 Democrats and 132 Republicans throwing their support behind the measure. It is in line with the spending caps deal reached between former Speaker Kevin McCarthy (R-Calif.), Senate Majority Leader Chuck Schumer (D-N.Y.) and President Biden last year. Speaker Mike Johnson (R-La.) and Schumer reaffirmed the spending deal, which sets a $1.65 trillion spending top line and includes $69 billion in adjustments that were part of a “side deal” to raise the federal debt limit in 2023.
Health and Wellness
CDC Updated Guidance Regarding COVID-19 and Its Potential Impact on NYS COVID-19 Paid Leave
The CDC’s new Respiratory Virus Guidance includes several changes to its prior COVID-19 specific guidance. Initially, the new guidance applies to individuals who contract respiratory illnesses including COVID-19, flu and RSV, and no longer focuses on COVID-19 alone. The guidance explains that this change was made to address the most common respiratory viruses that cause significant amounts of disease, especially in the fall and winter seasons. Next, the new guidance eliminates the five day isolation requirement, and instead recommends that individuals with these respiratory illnesses stay home and away from others until at least 24 hours after both their symptoms are getting better overall and they have not had a fever without the use of fever-reducing medication.
With the CDC’s elimination of the five day isolation requirement, New York employers are faced with the question of whether they must continue offering COVID-19 Paid Leave. Arguably, without a specific CDC isolation requirement, COVID-19 paid leave will no longer be required. However, the new CDC guidance still recommends that individuals who have respiratory illness, including COVID-19, stay home and away from others until at least 24 hours after both their symptoms are getting better overall and they have not had a fever. It is not clear if New York state will continue to interpret this as an isolation requirement that would entitle employees to COVID-19 Paid Leave. As such, whether New York employers must continue to provide COVID-19 Paid Leave is unclear. It is also worth noting that Gov. Hochul’s 2025 Executive Budget Proposal includes proposed legislation that would end the State’s COVID-19 Paid Sick Leave Law as of July 31, 2024. To date, that legislation has not been voted on or passed, but it may be adopted in the near future.
Read more at Bond Schoeneck & King
NYS COVID Update
The Governor updated COVID data for the week ending March 8th.
Deaths:
- Weekly: 55
- Total Reported to CDC: 82,932
Hospitalizations:
- Average Daily Patients in Hospital statewide: 874
- Patients in ICU Beds: 99
7 Day Average Cases per 100K population
- 4.9 positive cases per 100,00 population, Statewide
- 7.1 positive cases per 100,00 population, Mid-Hudson
Useful Websites:
Election 2024
- In Battleground States, Trump Is Ahead in Polls but Playing Catch-Up on the Ground - WSJ
- RFK Jr. Faces Tough Choices in Quest for Ballot Access – The Hill
- Democrats are Defending 23 of the 34 Seats Up for Grabs this Election Cycle – Fox News
- 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
China’s Exports Rise, Cheering Beijing—and Foreshadowing Backlash With Partners
China’s exports started the year on strong footing, offering a possible pathway for Beijing to hit its aggressive growth target this year while raising the likelihood of increased trade tensions. China’s outbound shipments rose 7.1% in the January-February period when compared with a year earlier, accelerating from a 2.3% increase in December, according to data released Thursday by Beijing’s General Administration of Customs. The jump in outbound shipments during the opening months of the year comes amid rising calls in the West for tariffs on Chinese-made autos
Exports were a critical growth driver during the three years in which China’s economy was battered by the pandemic. Beijing’s policies gave priority to keeping factories and businesses open, allowing the country long known as the world’s factory floor to continue churning out goods as manufacturers around the world went offline. As the impact of Covid-19 finally faded, Chinese exports ceased to serve as a contributor to overall economic growth and instead became a drag. China’s export sector last year posted its first annual decline since 2016. Even if exports can maintain their strong start this year, there are limits to how much outbound shipments alone can carry an economy as large as China’s.
US Trade Deficit Widens to Largest Since April on Higher Imports
The US trade deficit widened in January by more than forecast, driven by a pickup in the value of imports while exports were little changed. The shortfall in goods and services trade expanded 5.1% from the prior month to $67.4 billion, the widest since April, Commerce Department data showed Thursday. On an inflation-adjusted basis, the merchandise trade deficit increased to a three-month high of $86 billion in January.
The value of imports rose 1.1% to the highest level in a year, led by capital goods and motor vehicles. Exports edged up 0.1%. The figures aren’t adjusted for inflation. The US merchandise-trade deficit with China widened slightly. The value of goods imported from China rose to a three-month high. The goods shortfall with Mexico shrank to the lowest level in three months.
US Mulls Blacklisting CXMT to Curb China's Chip Advance
The United States is weighing sanctions on several Chinese tech companies, including chipmaker ChangXin Memory Technologies, in a bid to further restrain China's development of advanced semiconductors, Bloomberg News said on Friday. Citing people familiar with the matter, it said the commerce department's bureau of industry and security was considering adding ChangXin to the so-called entity list that restricts access to U.S. technology, along with five more Chinese firms.
ChangXin Memory Technologies said it "specializes in producing commodity DRAM memory chips for everyday consumer products, with a specific focus on civilian and commercial applications." The company complies with U.S export regulations, it said in a statement sent to Reuters on Sunday.
‘Global Economic Headwinds’ - DHL Owner Deutsche Post Expects Limited Earnings Growth This Year
DHL owner Deutsche Post cautioned that earnings could remain relatively flat this year as economic headwinds weigh on volumes through the first half. The gloomier outlook disappointed investors, sending shares down 6.3% to close at $39.07 euros Wednesday. The German logistics group, also known as DHL Group, doesn’t expect to see a broad economic upturn in the first half of 2024 and expects volumes to decline further in some markets before global economic momentum picks up in the second half of the year.
Logistics providers saw earnings surge in 2022 as strained supply chains sent freight rates soaring. But conditions normalized in 2023 as inflation and higher interest rates saw consumer demand wane while easing supply chains saw freight markets swing to overcapacity, pressuring freight rates. Deutsche Post said the weak market environment experienced last year, with lower business-to-business volumes driven by ongoing destocking by customers and a weak economic environment, has continued into 2024, so earnings are expected to decline in the first half before growing in the second half.
Bechtel Orders Large-Format 3D Printer for US Navy Operation
Bechtel Plant Machinery Inc. continues to outfit the integrated metal 3D-printing operation it is developing in Fort Lauderdale, Fla., to manufacture parts for the U.S. Naval Nuclear Propulsion Program. BPMI awarded a contract to Velo3D to provide its Sapphire XC large format printer, to produce parts in stainless steel 415, an iron-chromium-nickel alloy with good tensile strength and high corrosion-resistance across a range of temperatures. Bechtel is building the plant – and has contracted ATI Inc. to operate it – in order to develop and produce advanced nuclear propulsion systems for U.S. Navy nuclear-powered submarines, including vessels that are in production and those in development.
ATI Additive Manufacturing Products is a result of a two contracts totaling $889 million assigned by the U.S. Dept. of Defense to BPMI. It’s scheduled to come online this year, to produce parts that previously were produced by casting or other methods, to reduce lead times. It will be a vertically integrated operation that includes large-format metal additive manufacturing, heat treating, machining, and inspection – and in the future will add assembly of finished components. The Velo3D technology involves a laser powder-bed fusion process that is described as a “fully integrated program software and hardware solution.”
Read more at American Machinist
Justice Department Opens Criminal Investigation Into Alaska Airlines Door Blowout, Report Says
Justice Department investigators have reportedly contacted passengers, pilots and flight attendants of Alaska Airlines Flight 1282—launching a new criminal investigation that would inform an ongoing review of whether Boeing complied with an existing settlement of a federal investigation that came about after a pair of Boeing crashes in 2018 and 2019, the Journal reported.
The Journal also reported investigators with the Inspector General’s office at the Department of Transportation have sought to interview Federal Aviation Administration officials overseeing Boeing’s manufacturing—the FBI and the IG’s office similarly worked together during the investigation after the 2018 and 2019 crashes. The Justice Department has also reportedly begun to inform passengers onboard that Jan. 5 flight that they are potential victims of a crime, the Journal reported. Alaska Airlines told Forbes the company is “fully cooperating” and does not believe it is a “target of the investigation,” but also added that “in an event like this, it’s normal for the DOJ to be conducting an investigation.”
Two Canals, Two Big Problems—One Global Shipping Mess
Ship operators are bracing for months of uncertainty in the waterways where some 18% of global trade volumes crossed last year. More than 50 ships queued to cross the Panama Canal on a recent day—from tankers hauling propane to cargo ships packed with food. A prolonged drought has led the canal’s operator to cut the number of crossings, resulting in longer waits. The tolls that ships pay are now around eight times more expensive than normal. Over 7,000 miles away, vessels that move containers through Egypt’s Suez Canal are waiting for naval escorts or avoiding the passage altogether to take a much longer voyage around South Africa.
Cargo volumes through the Suez and Panama canals have plunged by more than a third. Hundreds of vessels have diverted to longer routes, resulting in delivery delays, higher transportation costs and economic wreckage for local communities. The problems haven’t had a huge impact on consumers yet, but businesses are starting to feel the ripples. Tesla and Volvo paused vehicle production for up to two weeks in January because of parts shortages. Some apparel companies opted for their spring fashions to be delivered by air instead of sea to ensure items arrived on time.
DOE to Spend $45 Million to Fund 16 Projects to Prevent Cyber Attacks in the Energy Sector
The U.S. Department of Energy (DOE) has allocated $45 million to help protect the nation’s energy sector from cyber attacks. The money will be used to fund 16 projects across six states that are designed to develop new cybersecurity tools and technologies that will be used to decrease the amount of cyber risks and increase the resilience of the U.S. energy system.
The program will be managed by the DOE’s Office of Cybersecurity, Energy Security, and Emergency Response (CESER) and includes projects from industry stakeholders, vendors, national laboratories, and academic institutions. Projects were submitted from Electric Power Research Institute, Inc., Georgia Tech Research Corporation, Texas A&M University-Kingsville, and Texas A&M University-Kingsville
Microsoft Wants to Make it Easier to Work from Your Car
Microsoft has recently rolled out its Work from Car, or WFC, feature. WFC operates by docking on your car’s dashboard and can connect to an Android smartphone via Bluetooth, transforming your vehicle into a hotspot through Microsoft’s cloud and 5G networks. This device promises ease in joining online meetings and managing work tasks while on the move. This announcement is fairly recent, and Microsoft hasn’t released many details. But it’ll likely take advantage of modern generative AI platforms such as Microsoft’s Copilot. Making for a much better voice control systems in cars.
Microsoft’s WFC seems to be a step toward modernizing the work-from-anywhere ethos, potentially saving time and offering convenience for those who spend hours on the road. Nonetheless, it prompts reflection on the evolving nature of work and mobility. Is the necessity to work from a vehicle diminishing as remote work becomes more entrenched?
Listen at Acceleration Economy