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Member Briefing November 5, 2024

November 5, 2024

Posted By: Harold King in Daily Briefing,

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NIST Issues Annual Report on US Economy

The National Institute for Science and Technology issues its annual statistical review of the U.S. manufacturing industry last week. There are three aspects of U.S. manufacturing that are considered: (1) how the U.S. industry compares to other countries, (2) the trends in the domestic industry, and (3) the industry trends compared to those in other countries. The U.S. remains a major manufacturing nation; however, other countries are rising rapidly. Some highlights of the report:

In 2022, there was $15.0 trillion of value added (i.e., GDP) in global manufacturing in constant 2015 dollars, which is 17.5 % of the value added by all industries ($86.1 trillion), according to the United Nations Statistics Division. The U.S. accounted for $2.6 trillion (15.1 %) in manufacturing valued added while China accounted for $5.1 trillion (31.0 %).
Direct and indirect (i.e., purchases from other industries) manufacturing accounts for 17.1 % of GDP. Among the ten largest manufacturing countries, the U.S. is the 2nd largest manufacturing value added per capita (see Figure 2.5) and out of all countries the most recent U.S. rank is 16^th.
Compound real (i.e., controlling for inflation) annual growth in the U.S. between 1997 and 2022 (i.e., 25-year growth) was 1.7 %, which places the U.S. below the 50th percentile. The compound annual growth for the U.S. between 2017 and 2022 (i.e., 5-year growth) was 1.5 %. This puts the U.S. just below the 50th percentile, above Canada and Germany among others.
Labor productivity for manufacturing increased by 0.4 % between the second quarter of 2023 and the second quarter of 2024. The five-year compound annual growth is 0.4 %.
For U.S. manufacturing, total factor productivity decreased 1.3 % from 2021 to 2022 and has a 5-year compound annual growth rate of 0.1 %.
The U.S. is ranked ninth in output per hour among 142 countries using data from the Conference Board. In recent years, productivity growth has been negative or has come to a plateau in many countries and the U.S. seems to be following this pattern of slow growth. There are competing explanations for why productivity has slowed, such as an aging population, inequality, or other factors.

Read More at NIST

U.S. Factory Orders Tumble In September - Fourth Drop In The Past Five Months

Orders for manufactured goods fell 0.5% in September, the Commerce Department said Monday. It is the fourth decline in orders in the past five months. The drop in September was in line with the forecast of economists surveyed by the Wall Street Journal, as the advance report on durable goods had already signaled weakness. In the more comprehensive data released Monday, durable-goods orders were revised to a 0.7% decline in September. That’s down slightly from the initial estimate of a 0.8% fall and follows a 0.9% drop in August.

A drop in civilian airplane orders was behind the large drop in orders in September driven in part by the strike at Boeing. Excluding transportation, overall orders were up 0.1%. The buildup in defense goods added some strength to the sector. Excluding defense, orders were down 0.6%. Core capital-goods orders, a key measure of factory activity, rose 0.7% in September after a 0.2% gain in the prior month.

Read More at MarketWatch

Boeing Factory Strike Ends As Workers Vote To Accept Contract

Factory workers at Boeing voted to accept a contract offer and end their strike after more than seven weeks, clearing the way for the aerospace giant to resume production of its bestselling airliner and generate much-needed cash. Leaders of the International Association of Machinists and Aerospace Workers district in Seattle said 59% of members who cast ballots agreed to approve the company’s fourth formal offer and the third put to a vote. The deal includes a 38% wage increase over four years, and ratification and productivity bonuses. However, Boeing refused to meet strikers’ demand to restore a company pension plan that was frozen nearly a decade ago.

Boeing CEO Kelly Ortberg said in a message to employees that he was pleased to have reached an agreement. “While the past few months have been difficult for all of us, we are all part of the same team,” Ortberg said. “We will only move forward by listening and working together. There is much work ahead to return to the excellence that made Boeing an iconic company.”According to the union, the 33,000 workers it represents can return to work as soon as Wednesday or as late as Nov. 12. Ortberg has said it might take “a couple of weeks” to resume production in part because some workers might need retraining.

Read More at Yahoo Finance

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Policy and Politics

Hudson Valley Put Under Drought Watch By DEC

The State Department of Environmental Conservation (DEC) has announced a Drought Watch for the Hudson Valley due to a significant shortage of rainfall and declining levels of streamflow and groundwater.

The DEC is encouraging residents in affected counties, particularly those dependent on private groundwater wells, to conserve water whenever possible during the coming weeks. Dutchess, Greene, Orange, Putnam, Rockland, Sullivan, Ulster, and Westchester are all under Drought Watch. A watch is the first of four levels of State drought advisories, which are watch, warning, emergency, and disaster. No mandatory restrictions are in place under a state Drought Watch.

Read more at Mid-Hudson News

PepsiCo Beats New York State's Lawsuit Over Plastics Pollution

PepsiCo (PEP.O), opens new tab won the dismissal of New York's lawsuit accusing the beverage and snack-food company of polluting the environment with single-use plastic packaging, as the judge criticized the state's attorney general, Letitia James, for bringing the case. Justice Emilio Colaiacovo of the state Supreme Court in Buffalo said on Thursday that James failed to show PepsiCo created a public nuisance and should have warned consumers about the health and environmental risks of plastics in more than 100 of its brands, opens new tab.

James sued PepsiCo and its Frito-Lay unit last November, seeking to hold them liable for endangering Buffalo's water supply by generating 17% of the plastic waste found in and near the Buffalo River. She also said the defendants deceived the public about their efforts to fight plastics pollution. But the judge ruled it would run "contrary to every norm of established jurisprudence" to punish PepsiCo, because it was people, not the company, who ignored laws prohibiting littering.

Read More at Reuters

White House Announces $3 Billion Port Investment

While appearing at the Port of Baltimore on October 29, President Biden announced a $3 billion investment to improve the port infrastructure. The money will be part of the Environmental Protection Agency Clean Ports grants, funded by the Inflation Reduction Act, to 55 selectees across 27 states and territories. This investment will support an estimated 40,000 jobs for the infrastructure improvements.

The funds announced will support the purchase of battery-electric and hydrogen-powered human-operated and human-maintained equipment, including over 1,500 units of cargo handling equipment, 1,000 drayage trucks, 10 locomotives, and 20 vessels, as well as shore power systems for ocean-going vessels, battery-electric and hydrogen vehicle charging and fueling infrastructure, and solar power generation.

Read more at Material Handling & Logistics

Health and Wellness

Long COVID Inflammation Damages Heart Cells

University of Queensland researchers have found that inflammatory proteins may be responsible for the lingering heart symptoms experienced by many long COVID patients. Research led by the University of Queensland has identified inflammatory markers in the blood of long COVID patients, offering potential insights into why many continue to experience cardiovascular issues. Associate Professor Kirsty Short explained that the research aimed to uncover the causes of persistent chest pain and heart palpitations reported by long COVID sufferers.

“We discovered elevated levels of cytokines, proteins which help control inflammation in the body, in the blood samples of people at about 18 months post-infection with SARS-CoV-2,” Dr. Short said. “Lab studies showed these trace-level cytokines had a direct effect on the functionality of cardiomyocytes, the cells of the heart responsible for its pump function. “These particular types of cells are fundamental building blocks for our heart, so damaging them can lead to cardiovascular symptoms.”

Read more at SciTechDaily

Election 2024

Industry News

How Can HR Manage What Will Be A Stressful Week For American Employees?

A poll released last month by the American Psychological Association found that 80% of workers surveyed are stressed about the future direction of the nation. Those concerns have made their way into the workplace. Research released last week from ResumeBuilder found the presidential election has escalated conflicts among employees, with nearly 40% saying election stress has impacted productivity and morale. Seventy percent of managers predict such tensions will escalate after election day.

Some of workers’ election stress may be directly connected to the workplace: According to Alight’s 2024 International Workforce and Wellbeing Mindset Study, more than one-third of respondents believe the results of the presidential election will have a significant impact on their job. Likely complicating HR’s efforts to ease election stress in the week ahead will be the ongoing political debates in the workplace. Nearly half of those surveyed by Alight don’t want to hear political discussions at work. Regardless of how willing some employees may be to discuss the topic, it’s “sure to make many colleagues uncomfortable…. Issuing a blanket ban on workplace political discourse is not the answer, but that doesn’t mean civility has to go out the window,” says Michael Rogers, CHRO of Alight. As election stress skyrockets, Rogers says, employees should be cautioned to maintain a professional demeanor at all times and be reminded of company codes of conduct.

Read More at HR Executive

OPEC Positive On Global Oil Demand, Sees No Peak On Horizon

he Organization of Petroleum Exporting Countries (OPEC) is very positive on demand for oil in both the short and long term, Secretary General Haitham Al Ghais said at an energy industry event in Abu Dhabi on Monday. "There are some challenges, but the picture is not as negative as some make it sound," he said, adding that so-called peak demand would not happen while the global economy continues to grow.

Ghais said the oil producer group was upbeat on the global economy, noting growth in the U.S. and in China, adding that 5% growth is still very good for a country of China's size, even if it achieved up to 10% in previous years. He also reiterated his view that demand will not peak any time soon. "It reminds me of all the talk on peak supply many years ago. Peak supply never happened and peak demand won't happen as the world keeps growing," he said.

Read more at Reuters

Stellantis Q3 Year-Over-Year Revenue Nosedives 27%

Stellantis’ Q3 year-over-year net revenue tumbled 27% to 33 billion euros ($36 billion) from 45.1 billion euros a year earlier, the company reported Oct. 31. The company blamed the revenue fall on pricing and foreign exchange impacts and fewer new vehicle shipments as it worked to transition its global production to electric vehicles. Stellantis has been retooling its global operations as part of its strategy to ramp up its shift to electrification and achieve net zero carbon emissions by 2038. The transition has led to fewer newer models being built by the company, which has translated to an inventory glut for the automaker.

In the U.S., Stellantis’ Q3 YoY sales fell 20.8% to 301,293 from 380,563, according to Cox Automotive. But Ostermann told analysts the company expected the drop as part of its preparations for upcoming new vehicle launches. Newly appointed CFO Doug Ostermann said Stellantis’ efforts to reduce its U.S. dealer inventory from 430,000 units at mid-year to 330,000 should be achieved this month thanks to lower pricing on older model vehicles and incentives.

Read more at Automotive Dive

Mitsubishi Corp, Nissan To Establish JV On Autonomous Driving, EV Batteries, Yomiuri Says

Nissan Motor and Mitsubishi will form a joint venture by the end of fiscal 2024 for services involving electric vehicles and self-driving cars, Japanese daily Yomiuri Shimbun has reported. The JV will aim to provide robotaxi services using Level 4 autonomous driving technology and at-home EV battery storage, among other services. The venture will be funded equally by both companies, with verification tests expected to begin in 2025, according to the report.

Nissan is currently developing the robotaxis, while Mitsubishi is working to commercialize a system that uses artificial intelligence to figure out optimal routes. The companies are targeting to launch the robotaxi services initially in Yokohama and Namie in Japan. The JV will also work on providing a service that connects EVs to homes and power grids, which would allow people to use electricity stored in their cars at home or sell it to power companies. It will also explore the collection of used EV batteries for secondary use and recycling.

Read more at Seeking Alpha

Navy Asks RTX Raytheon For Infrared-Guided Air-To-Air Missiles Compatible With Helmet-Mounted Displays

U.S. Navy aerial warfare experts are asking RTX Corp. to build more than 1,200 AIM-9X precision short-range infrared-guided air-to-air missiles for jet fighters and other combat aircraft under terms of a $736.6 million five-year contract announced in September. Officials of the Naval Air Systems Command at Patuxent River Naval Air Station, Md., are asking the RTX Raytheon segment in Tucson, Ariz., to build lot 24 AIM-9X block II and block II-plus air-to-air missiles for the U.S. Navy, Air Force, Army, and foreign allies.

The order is for AIM-9X Block II and II-plus tactical missiles; captive air training missiles; special air training missiles; captive test missiles; missile containers; spare advanced optical target detectors; guidance units and containers; propulsion steering sections; dummy air test missiles; training missiles; tail caps and containers; and related equipment. The AIM-9X is an infrared-guided heat-seeking missile that equips most jet fighters, fighter-bombers, and other offensive combat aircraft in the U.S. arsenal, and is for shooting down enemy aircraft close-by. The AIM-9X works by homing in on an enemy aircraft's hot engine exhaust. Variants of the AIM-9 Sidewinder have been deployed since the 1950s.

Read more at Military & Aerospace Electronics

Latest Riyadh Airbus Jet Order Worth Billions

Airbus reports a firm order for 60 new A321neo jets from a Saudi Arabian start-up airline, Riyadh Air. Though the manufacturer did not reveal the value of the order, the reported list price of the A321neo suggests the contract could be as much as $3.48 billion. Riyadh Air is owned by the nation’s Public Investment Fund, and last year ordered more than three dozen Boeing 737 MAX 9 jets as part of a strategic plan to establish Saudi Arabia as “a global aviation hub,” and to serve 330 million passengers and 100 million visitors annually by 2030.

The A321neo is a narrow-body, twin-engine jet with capacity for 206 passengers in a two-cabin arrangement. It has the longest fuselage among the variants of Airbus’ top-selling A320 series. The OEM has recorded more than 6,700 orders for A321neo jets since it was introduced in 2011. Airbus also notes that the A320neo series produces 50% less and achieves more than 20% greater fuel savings and CO₂ reduction than the previous generation single-aisle aircraft.

Read more at American Machinist

The US Solar Industry’s Tariff Paradox

Solar panels were invented in the United States, but the industry that makes them mostly died out in this country long ago. The U.S. fell behind for a number of reasons, and subsidized Chinese manufacturing was one of them, according to both the Trump and Biden administrations. The U.S. imposed tariffs and offered subsidies of its own to re-create the solar supply chain here, and solar manufacturing in the U.S. has been making a comeback. But it has come at a cost, and solar manufacturers say the success they’ve had so far is at risk.

Lisa Nash took on a job as general manager for a small factory in Dalton, Georgia making solar panels. “We started out, we were gonna be around 300 people and that turned into 750 people, then now, we’re two buildings and 2,000 people. We make about 60,000 panels a day here in Dalton,” she said. That plant exists because of trade policy. But for everything leading supplying the plant — the pieces that go into those panels — the American supply chain has gaping holes.

Read more at Marketplace

Siemens Buying Sim Software Developer for $1.6B

Siemens AG is buying software developer Altair Engineering for a reported $10.6 billion, aiming to strengthen its portfolio of technologies for industrial design and simulation. Detroit-based Altair designs computational science, simulation, and analysis software used by designers in automotive, aerospace, and other major manufacturing sectors to simulate how product designs might work in actual use. Its products are important source technologies for artificial intelligence programs.

For Siemens, adding Altair to its industrial automation portfolio will strengthen its resources for linking hardware and software, and digitalizing manufacturing. Siemens called the Altair simulation portfolio “highly complementary,” notably for mechanical and electromagnetic engineering. Adding the new capabilities will enhance Siemens’ “comprehensive Digital Twin to deliver a full-suite, physics-based, simulation portfolio as part of Siemens Xcelerator.

Read more at American Machinist

3 In 4 Front-Line Workers Globally Feeling Burnt Out: Poll

Many frontline workers feel overworked, underappreciated, and are tempted to quit for a better employee experience, according to a new report. More than 3 in 4 (75%) of these workers feel burnt out, found the UKG survey of nearly 13,000 front-line workers and managers in 11 countries. In addition, among front-line workers:

62% say interactions with people at work have worsened their mental health
59% say they may quit because of negative interactions with their managers, co-workers, or customers
55% say they aren’t satisfied with their employee experience
19% say they’re never recognized by their manager.

The report also found that frontline employees need more support, as 42% said their organisation treats them like a number, not a person, and 46% consider quitting on days when the jobs get tough, according to the report.

Read more at Human Resources Director

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