Member Briefing May 12, 2022
8.3% – Inflation Slipped in April, But Upward Pressures Remain
The Labor Department’s consumer-price index reading last month marked the first drop for inflation in eight months, down from an 8.5% annual rate in March. But the decline came primarily from a slight easing in April gasoline prices, which reached a new high on Tuesday. Broadly, the report offered little evidence that inflation was cooling. The CPI measures what consumers pay for goods and services.
On a monthly basis, the CPI rose a seasonally adjusted 0.3% last month after a 1.2% increase in March. However, the so-called core-price index—which excludes the often-volatile categories of food and energy—increased 0.6% on the month, a sharp pickup from March’s 0.3% gain, providing a sign of broad-based inflationary pressure.
Invasion of Ukraine Headlines
- Ukraine and Russia: the Latest News – CNN
- U.S. Temporarily Suspends Tariffs on Steel Imported from Ukraine – CBS News
- New Leadership in Kherson Says It’ll Begin Issuing Russian Passports to Those Who Want Them by End of Year – CNN
- Russia’s Medvedev, Volodin Lash out at U.S. Aid to Ukraine – Reuters
- EU Tensions Grow Over Russian Oil Ban as Hungary Demands Exemption – Politico
- Ukraine Pushes Russian Forces Cack, Restricts Gas Flow to Europe – Reuters
- Map – Tracking Russia’s Invasion of Ukraine – Live Universal Awareness Map
Inflation Slows But Prices for Many Goods Rising
U.S. inflation slowed in April, according to new data Wednesday, but Americans continue to see their wallets empty faster when they buy groceries and pay the rent. The dip was helped by easing energy costs, as gasoline fell 6.1% in April compared to March after the 18.3% surge in the previous month. But gasoline prices at the pump hit a new record on Tuesday, so the news from April may be of little comfort to drivers.
CPI rose just 0.3% compared to March, after the 1.2% surge in the prior month, but excluding volatile food and energy goods, the “core” index last month increased at double the March rate, the report said. A large driver was food at home, which jumped 10.8% over the last 12 months — the largest annual increase since November 1980, according to the report.
Judge Upholds Assembly Lines in Redistricting Challenge, June Primary to Proceed
The state Assembly maps will stay intact, Steuben County Judge Patrick McAllister ruled Wednesday in response to legal filings from two men who were seeking a redrawing of the lines.
Citing the tight timeline between now and the scheduled June primaries, McAllister wrote that “since the court has received no potential maps with regard to new Assembly lines it would almost assuredly mean that the new maps could not be in place by May 20th.” That is the deadline McAllister set for both the state Senate and congressional maps – which were deemed unconstitutional and the latter gerrymandered by the State Court of Appeals last month – to be redrawn by a special master.
US COVID – By the Numbers
- Cases to date: 81.8 million
- Death toll: 995,371
- Current hospitalizations: 13,457
Shots administered: 579 million
- Fully vaccinated: 66.3 percent
COVID Booster Rollout Needs a Reboot to Save Older Americans, Experts Say
Approximately 1 in 3 Americans 65 and older who completed their initial vaccination round still have not received a first booster shot, according to the Centers for Disease Control and Prevention. The numbers have dismayed researchers, who note this age group continues to be at the highest risk for serious illness and death from Covid-19.
People 65 and older account for about 75 percent of U.S. Covid deaths. Among older people who died of Covid in January, 31 percent had completed a first vaccination round but had not been boosted, according to a KFF analysis of CDC data. The failure to boost more of this group has resulted in the loss of tens of thousands of lives, said Dr. Eric Topol, founder and director of the Scripps Research Translational Institute. “The booster program has been botched from Day One,” Topol said. “This is one of the most important issues for the American pandemic, and it has been mismanaged.”
Federal Judge Dashes Democrats’ Hopes for N.Y. District Maps
A federal judge in Albany on Tuesday authorized New York to push back its congressional primary until August, a delay that will give more time for a neutral expert to draw new congressional maps for this year’s midterm contest. The scheduling change all but kills a last-ditch effort by national Democrats to preserve district lines that would have helped them maintain control of the House but were declared unconstitutional in a series of court decisions.
The order was the latest — and possibly the final — twist in a high-stakes legal dispute over New York’s congressional maps that has raged for two months in state and federal court, leaving the campaign season in chaos.
McMahon: Recent Stock Market Trends Could Punch a Hole in New York’s State Budget.
Governor Hochul’s FY 2023 Executive Budget, when released in January, projected that the net capital gains of New York tax filers would reach nearly 18 percent of total adjusted gross income in the state’s personal income tax base for 2022. That would amount to an all-time high, eclipsing the 16 percent capital gains share of the tax base in 2007—just before the financial crisis and Great Recession.
Capital gains income is strongly correlated with stock prices, and the Executive Budget forecast the S&P 500 would rise by 7.4 percent this year, on the heels of a nearly 30 percent increase in bullish 2021. Instead, with some ups and downs, the major stock indexes have all declined in 2022; as of the market’s close today, the S&P 500 had sunk by a net 17 percent since the start of the year. Fulfilling the budget forecast would require the S&P to surge by 28 percent between now and the end of the year. Anything is possible, but this would be highly unlikely.
A Canary in the Supply Chain Coalmine: Late Payments Up, Orders Down
The end of 2021 offered signs of hope. According to Tradeshift’s Q4 Index of Global Trade Health, which analyzes anonymized data flowing across our platform, order volumes were up and there appeared to be a gradual easing of the bottlenecks that had left supply chains snarled. But the world had other plans. The same report for the first quarter of 2022 shows another steep fall in activity across the world’s supply chains.
Manufacturers, particularly those in the industrial heartlands of Western Europe, have been the hardest hit by recent turmoil. Total transaction volumes across the Eurozone fell 14 points in Q1, the steepest loss of momentum since the beginning of the pandemic. Globally, the data suggests supply chain activity related to the manufacturing sector is 25% lower than expected.
ADP – Recently Retired Baby Boomers Return to Work
Employers and Baby Boomers may soon find themselves in a mutually beneficial relationship. Businesses need to fill job openings resulting from the Great Resignation, while many older adults who retired during the pandemic now lack financial security amidst rising inflation.
Yet, solving labor shortages may not be as simple as having Baby Boomers at work once more. Many of them have different expectations about work than they did prior to the pandemic and may need training if their roles or responsibilities are changing. Employers will also have to overcome unconscious ageism biases and rethink some of their talent management strategies.
State Assembly Committee Advances Single Payer New York Health Act
Assembly Democrats in the Codes Committee voted along party lines Tuesday to advance the New York Health Act to establish a statewide single-payer health care system. Democrats in the 21-member committee, excluding Assemblyman Steven Cymbrowitz, of Brighton Beach, voted to send the measure to the Ways and Means Committee scheduled to meet noon Wednesday. Republican assembly members unanimously voted against the bill, citing concerns of increasing costs on taxpayers.
The bill, sponsored by Assembly member Rick Gottfried and Sen. Gustavo Rivera in the upper house, outlines the administrative structure, payment methodologies, care coordination and health care provider negotiations for a single-payer health system for all state residents. The measure would also create the New York Health Trust Fund from a variety of state and federal sources to finance the plan.
April Inflation Report Cinches Fed’s Half-Point Rate Rise Path
The rapid pace of U.S. inflation stayed strong last month, offering little reassurance to the Fed even though the year-over-year rate of growth slowed. On a monthly basis, the consumer price index rose a seasonally adjusted 0.3% in April, according to a Labor Department report on Wednesday. Inflation rose 8.3% from a year earlier, down from the annual increase of 8.5% in March.
Wednesday’s report offers few signs that would give Fed officials comfort to dial back a more aggressive pace of rate increases this summer. Because a decline in 12-month inflation readings have been largely anticipated, the question now shifts to where inflation might settle and whether that level will be unacceptably high for the central bank.
Business Workforce Survey 2022 – Deadline to Complete is Friday 5/13
New York State – in partnership with the Business Council of New York State – has developed a comprehensive online survey to solicit vital feedback from businesses on the skills required for workers to be successful in today’s complex economy, and how New York can prepare and position its labor force to better serve companies’ needs.
Collective results from this survey will be used by the State and the Regional Economic Development Councils to develop an inventory of and strategy to address regional needs. Individual responses will be kept confidential.
The survey can be found here
Biden’s Recovery Plan: Pump up Unions, Squeeze Big Business
Biden is leaning into his association with organized labor more aggressively than any president in modern times. Over the last few weeks alone, he’s warned major businesses that their workforces will seek to unionize, with his support. He has backed a push on Capitol Hill that is paving the way for congressional staffers to unionize. He recently met with a new generation of union organizers at the White House and put out a video of the meeting on Wednesday in which he jokingly told one of the organizers he was “[good] trouble.”
Biden’s moves to polish his union credentials amount to a bold bet that appeals to working Americans on economic grounds can help offset some of the damage Democrats are dealing with among the cohort when it comes to rising prices and blazing culture wars.