Member Briefing September 11, 2023
Hochul Signs Bills on ‘Captive Meetings,’ Wage Theft, Injury Compensation
New York Gov. Kathy Hochul signed a package of legislation into law aimed at protecting employees in the workplace.
- One measure prohibits employers from disciplining employees who decide not to participate in meetings about the employer's political or religious views. The bill curtails an employer’s ability to hold captive audience meetings, which are mandatory meetings held by an employer during working hours to discuss union organizing. Captive audience meetings have been a commonplace practice used by employers to communicate information to their workforce about the impacts of unionization in the workplace during the course of an organizing attempt by a union.
- Another piece makes wage theft a form of larceny and lets prosecutors seek stronger criminal penalties against employers who steal wages from their workers.
- A third piece of legislation increases the minimum benefits for workers' compensation for low-wage workers who are injured and are unable to work. The third bill increases the minimum benefits for workers’ compensation to help low-wage workers who may be injured and cannot work. Starting in 2024, the minimum benefits for permanent or temporary partial disability will be $275 weekly and will be increased to $325 in 2025 and increased to one-fifth of the state average weekly wage in 2026.
Major labor unions throughout the state heralded the bill signings.
War in Ukraine Headlines
- Ukraine and Russia: The Latest News – The Guardian
- Ukraine Rips Elon Musk for Disrupting Sneak Attack on Russian Fleet with Starlink Cutoff - CNBC
- G20 Statement Drops Reference to Russia Aggression ‘Against’ Ukraine – Financial Times
- Ukraine, Russia Report Downing Dozens of Drones Over Kyiv, Crimea - Reuters
- US General Warns Time Is Running Out for Ukraine's Counteroffensive - Newsweek
- Ukraine's 50-Year-Old Gepards Are Still The Best Air-Defense Guns – Forbes
- Russia Ramps up Artillery Production but Still Falling Short, Western Official Says - Reuters
- US Likely to Send Long-Range ATACMS Missiles to Ukraine for the First Time: Officials - ABC
- The Critics of Russia's War in Ukraine Caught in Jail 'Carousel' - Reuters
- In Crimea, Pro-Ukraine Feelings Prompt a Russian Crackdown - WSJ
- 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
U.S. Trade Deficit Widens in July
Diesel prices have climbed more than 40% in the U.S. and Europe since May, when surprise output cuts by Saudi Arabia and some other members of the OPEC+ oil cartel took effect, Argus data showed. Most actively traded futures prices for Brent crude and West Texas Intermediate, the benchmarks for crude oil, are up 13% and 14% in the same time frame. The run-up is translating into higher pump prices and trucking costs in the U.S. and elsewhere in the West. It reflects the fact that heavier kinds of oil are better suited to making diesel, while others, such as lighter U.S. crude, are more readily turned into gasoline.
In the U.S., while the national average price for unleaded gasoline added 7 cents a gallon in August, according to AAA, the cost of diesel rose by 42 cents a gallon. “Diesel is more heavily affected because of the type of crude that’s being taken out of the market,” said Alan Gelder, vice president for refining, chemicals and oil markets in Wood Mackenzie’s commodities research business. “Saudi’s oil provides a higher yield for diesel than lighter crude oils. This loss adds further cost to the economy.”
U.S. Salary Increase Budgets hit 20-Year High
Increases to salary budgets rose to 4.4% on average this year, slightly higher than earlier projections of 4.1%, and also marking the highest level since the 2001 peak of 4.5%, according to a WorldatWork survey released last week of more than 2,000 U.S. employers. Last year, salary increase budgets stood at 4.1%. A tight labor market and cautious economic optimism contributed to the increase, Liz Supinski, director of research and insights at WorldatWork, tells HRE.
Budgets are expected to slightly drop next year, to 4.1%, according to the survey. The forecasted 2024 decline, she adds, may also be the result of an easing of the intensity of the labor market pressures as the impact of economic policy decisions filters out. In addition to salaries rising across the globe this year, employers are scaling back on layoffs, according to the WorldatWork survey. This year, 70% of employers worldwide reported no layoffs and a whopping 91% expect the same for 2024.
COVID Update – New Covid Vaccines are Coming Out. Should You Get One?
with an updated booster on the way, the Centers for Disease Control and Prevention (CDC) is expected on September 12 to announce its recommendations for the new shot, which is specifically designed to target prominent variants of the omicron strain. The big questions: Who should get it? Should we start expecting yearly reformulations like we see with the yearly flu shot? And is there any way to boost the number of people who will get a booster?
Looking at previous guidelines and based on past recommendations, experts agree that if you haven’t received a bivalent vaccine yet, you definitely should (even if you’re young and healthy). This shot protects against the original and omicron strains of SARS-CoV-2 and until the new boosters become available, are the only type currently approved by the US.Whether young, healthy individuals who already receive a bivalent shot should get the immunization is murkier. Some experts believe it could be a good idea to do so before the winter surge, while others think it’s not a current priority (given that formerly vaccinated and infected individuals still have T-cells primed to protect against severe infection).
NYS COVID Update
The Governor updated COVID data for the week ending August 25th.
- Weekly: 54
- Total Reported to CDC: 80,146
- Average Daily Patients in Hospital statewide: 1,395
- Average Daily Patients in ICU Statewide: 126
7 Day Average Cases per 100K population
- 13.0 positive cases per 100,00 population, Statewide
- 13.6 positive cases per 100,00 population, Mid-Hudson
Key Takeaways from the 2023 G20 Summit in New Delhi
Leaders of the world's 20 big economies ended a summit in the Indian capital on Sunday overcoming deep divisions over the war in Ukraine to produce a consensus document and move forward on issues such overhauling institutions like the World Bank. They also formally admitted the African Union to the bloc to make the grouping more representative.
- G20 nations agreed that states cannot grab territory by force and highlighted the suffering of the people of Ukraine, but avoided direct criticism of Russia for the war. The declaration was seen as an apparent softening from the position that the G20 took last year when it condemned Russia for the war and demanded that it withdraw from Ukraine.
- The 55-member African Union was formally made permanent member of the G20, on par with the European Union, in order to make the grouping more representative. Until now only South Africa was a member of the G20.
- Leaders of the United States, India and Saudi Arabia among others announced plans to set up rail and ports links between the Middle East and South Asia and eventually to Europe. The Biden administration is seeking to counter China's Belt and Road push on global infrastructure by pitching Washington as an alternative partner and investor for developing countries at the G20 grouping.
- The G20 leaders agreed to pursue tripling renewable energy capacity globally by 2030 and accepted the need to phase-down unabated coal power, but stopped short of setting major climate goals.
For Indian Prime Minister Narendra Modi, the leadership of the G20 has been a year-long opportunity to showcase India as an influential diplomatic and economic power, and drive investment and trade flows into the world's most populous country.
Stellantis Offers 14.5% Pay Increase to UAW, Days Before Possible Strike
Stellantis on Friday offered significant four-year wage increases to its hourly workers represented by the United Auto Workers, as it scrambles to avoid a costly strike. The automaker’s offer would provide a 14.5% wage increase over the four-year term of the proposed deal for most of Stellantis’s roughly 43,000 UAW-represented hourly workers. Newer, or in-progression, employees would get a 27% boost to their starting wages and a shorter time period — six years, versus eight years under the current deal — to advance to the maximum wage rate.
The current contracts between the UAW and the three Detroit automakers will expire at 11:59 p.m. on Thursday. Stellantis’s offer also provides its UAW-represented employees with a $6,000 one-time “inflation protection payment” in the first year of the deal, and a total of $4,500 in additional payments over the following three years. But the proposed deal still falls well short of the union’s demands, which include a 40% hourly pay increase, a 32-hour workweek, and restoration of traditional-style pension plans, among other items. Only about 30% of Stellantis’s UAW-represented workers — those hired before October 2007 — currently have pension plans.
How Large Are Inflation Revisions? The Difficulty of Monitoring Prices in Real Time
In this Liberty Street Economics post, NY Fed economists investigate the size and nature of revisions to inflation. They find that inflation estimates for a given month can change substantially as subsequent data vintages are released. The difference is dramatic and points to the difficulty of monitoring inflation in real time. The results suggest that there is significant uncertainty in measuring inflation, and the key features of the recent spike and subsequent moderation of inflation may look quite different in hindsight once further revisions have taken place.
The economists have shown that differences between PCE inflation for all vintages and CPI inflation can be substantial. For example, over the period from 2001-18 the gap ranged from -1 to 1.6 percentage point and 90 percent of the time was between -0.5 and 0.5 percentage point. Taken plainly, these gaps would suggest a plausible range for the current year-over-year core PCE inflation rate of as high as about 4.7 percent and as low as around 3.7 percent. These results show the significant uncertainty surrounding the measurement of inflation in real time, which adds to the challenges faced by policymakers, analysts and the general public in analyzing inflation.
China Exports Fall for a Fourth Month as Once-Reliable Growth Engine Sputters
China’s exports to the rest of the world dropped for a fourth straight month in August, bringing little relief to the country from a deepening economic malaise and weighing on the global trade outlook. China has struggled to sustain a wave of overseas demand for Chinese-made goods that carried it through much of the three years of the pandemic, particularly as Western consumers tilted their spending back toward services and away from smartphones, furniture and other goods. Higher borrowing rates in the U.S. and other developed countries also hit consumer appetite.
Meanwhile, Chinese imports continued to shrink in August, a reflection of lackluster consumer demand even after the country loosened its longstanding Covid-related restrictions. A downturn in China’s property market has also sapped demand for raw materials used in construction. Taken together, the sluggish trade data released Thursday by Beijing provides new evidence that the world’s second-largest economy is struggling to revive domestic demand.
German Industrial Output Falls More than Expected in July
German industrial production fell by slightly more than expected in July, the federal statistics office said on Thursday, underlining the challenges faced by the sector after a winter downturn in Europe's largest economy. Production fell by 0.8% in July compared to the previous month. Analysts polled by Reuters had predicted a 0.5% decline. In the less volatile three-month comparison, production between May and July was 1.9% lower than the previous three months, the data showed.
Germany's manufacturing sector has had a difficult year so far due to dwindling orders, sluggish output and high prices, with the HCOB final Purchasing Managers' Index (PMI) for manufacturing falling for a sixth consecutive month in July. Industrial production (manufacturing excluding energy and construction) decreased by 1.8% in July compared to June, while the production of capital goods fell by 2.9% and the production of consumer goods decreased by 1.0%, the data showed.
The Queue of Ships at the Panama Canal is Now Normal for the Time of Year
The number of ships waiting to pass through the Panama Canal has dropped by a fifth to 108 since last week, according to the Panama Canal Authority. Last week, the queue consisted of 135 ships waiting at both ends of the canal. The current queue is normal for this time of year, according to the Canal Authority, which has imposed restrictions on vessel traffic through the canal due to extraordinary drought and consequently lower water levels.
Due to the El Niño weather phenomenon, the dry season has been extended in Panama this year, leading to unusually low water levels in Gatun Lake, which supplies water to the canal’s locks. The water level in Gatun Lake is currently 24.2 meters compared to 26.6 meters in September last year. The dry season in Panama usually starts in November and ends at the end of April, but this year El Niño has prolonged the drought and created queues and delays for shipping through the Panama Canal.
Cummins, Daimler, PACCAR Form Joint Venture for US Battery Cell Production
Three of the trucking industry’s biggest players, are forming a multibillion-dollar joint venture to produce battery cells for commercial vehicles and other industrial applications at a U.S. plant, the biggest such project of its type in North America. The companies plan to invest as much as $3 billion combined and each hold 30% stakes in the as-yet-unnamed venture, which will open in a little over three years.
It will be scaled to churn out 21 gigawatt-hours of lithium-iron-phosphate, or LFP, battery cells annually at a factory site that hasn’t yet been determined, Cummins CEO and President Jennifer Rumsey told Forbes. Chinese battery maker EVE Energy will share its LFP cell technology with the venture and own a 10% stake. Each partner will decide how to use cells in their products. Cummins’ Accelera may focus on using them in buses and medium-duty vehicles as well as stationary energy storage systems, Rumsey said. Daimler, maker of Freightliner, Mercedes-Benz and Fuso brands, and Paccar, which builds Kenworth and Peterbilt semis, will use them for trucks.
Military Services’ Zero Trust Plans to Go Under the Pentagon’s Microscope
Within weeks the Pentagon will begin reviewing zero trust plans from each of its components to make sure they align with the department’s vision of fielding a “targeted” level of zero trust by fiscal 2027, the department’s chief information officer (CIO) said today.
DoD released its zero trust strategy last November outlining what it would take to achieve what it called a “targeted” level of zero trust, or a required minimal set of 91 activities DoD and its components need to achieve by FY27, to address threats, including those posed by cyberspace adversaries like China. An additional 61 activities outlined in the strategy will get the Pentagon to a more “advanced” level of zero trust later. The 29-page strategy painted a concerning picture for DoD’s information enterprise, which is “under wide-scale and persistent attack from known and unknown malicious actors,” from individuals to state-sponsored adversaries, specifically China, who “often” breach the Pentagon’s “defensive perimeter.”
Airbus and Air France Propose Global MRO Venture
Airbus is negotiating establishment of a new joint venture with Air France SA to provide component maintenance services (maintenance, repair, overhaul, or MRO) for the global A350 fleet. The organization and valuation for the venture were not described, but Airbus indicated the partners would have equal ownership stakes and foresee a 2024 start. The Airbus A350 is a twin-engine wide-body aircraft in service on long-range routes with more than three dozen carriers and leasing agencies. According to Airbus, there are more than 550 A350 jets currently in service and more than 1,000 on order.
Combining the maintenance capabilities of the Air France Industries KLM Engineering & Maintenance organization with the design and manufacturing resources of Airbus would create “an optimized commercial offering,” according to the OEM, and address the long-term maintenance needs of A350 operators.