Here are some highlights from today's BLS employment release:
1. Manufacturing employment increased by 37,000 in March, following gains of 31,000 in February and 52,200 in January, for a first quarter factory job gain of 120,000. That's the largest first quarter increase in manufacturing jobs in 28 years, going all the way back to 1984.
2. The 37,000 gain in March factory jobs represented almost one out of every three of the total 120,000 payroll jobs added last month.
3. The jobless rate for the manufacturing sector fell from 8.4% in February to 7.6% in March (not seasonally adjusted - NSA), which was the lowest rate since November 2008, and marked the tenth straight month that the manufacturing jobless rate was below the national average (8.4% in March, NSA).
4. Average weekly overtime for manufacturing edged up to 4.3 hours in March, which was the highest weekly overtime since March 2007.
MP: The chart above displays the percentage employment gains since January 2010 for: a) manufacturing and b) total payroll employment, showing the 4.03% increase in factory jobs compared to the 2.71% increase in overall payrolls. American manufacturing has made a strong comeback over the last several years, which has increased factory employment by 462,000 since 2010, and has brought the once-dismissed industrial sector to the forefront of the economic expansion.
According to a recent Merrill-Lynch research report "An Industrial Revolution":
"We think that the manufacturing sector represents an important growth driver for the U.S. economy – generating more economic activity than any other business sector. In our view, the U.S. economy is in the early stages of a long term manufacturing renaissance. Manufacturers are increasingly likely to bring at least some production back to the U.S. while established players reinvest for further productive capacity and productivity improvements over the coming years."
In its March 27 report, Merrill-Lynch lists 68 new major industrial investment projects totaling more than $200 billion that have been announced or started just since 2011 in a wide variety of manufacturing industries like petrochemicals, chemicals, steel, refining, autos, heavy equipment, aerospace, plastics and ethylene.
Welcome to America's manufacturing renaissance.
Daily Markets is reporting the exact same story.
ReplyDeleteMake baby, make.
Welcome to America's manufacturing renaissance.
ReplyDeleteRenaissance? Is that what you call a weak labour market even though the Fed has been flooding the system with liquidity? I am sorry Mark but you seem to be suffering from recovery fever yet again.
The US is looking at a foreclosure crisis yet again.
Gasoline usage is falling.
Saving rates are falling again.
Electricity use is down.
Food and gasoline prices are up sharply.
GM is stuffing the inventory channel.
Labour participation rates have collapsed.
Obama is still looking at a victory in November and the regulatory bulldozer keeps rolling along as it crushes the life out of entrepreneurial activity in the US.
"Renaissance?"
ReplyDelete"The US is looking at a foreclosure crisis yet again."
Again? It never went away but the housing market may be finding a bottom.
"Gasoline usage is falling."
Of course it is. From GM's latest earnings call with Don Johnson(VP US Sales):
"...consider this fact; just three short year's ago about 16% of the vehicles that we sold achieved at least 30 miles per gallon on the highway. Contrast that today where that number is closer to 40%."
"Saving rates are falling again."
This is troubling, can not disagree.
"Electricity use is down."
A very mild winter in the Midwest and East can do that, and it just did.
"Food and gasoline prices are up sharply."
Gasloine up sharply and food not so sharply but certainly up.
"GM is stuffing the inventory channel."
The chart is a year old and when auto sales were beginning to take off.
"Labour participation rates have collapsed."
Baby Boomers are retiring in record numbers, before they collapse.
It depends how you define renaissance - rebirth, revival, restoration, renewal, resurgence.
ReplyDeleteThe U.S. shifted from low-end manufacturing to high-end manufacturing, including through offshoring (note, offshoring reduces U.S. productivity and raises productivity offshore).
U.S. manufacturing produced more output with fewer inputs, particularly since 2000 (do you prefer more wealth or more work?).
Because of the differences in market power, the U.S. was able to import goods at increasingly better values, while the U.S. was able to export goods at increasingly better values (so, the U.S. gained more in both imports and exports than its trading partners).
The U.S. has maintained its global share of manufacturing output at around 20% with over 30% less labor since 2000. So, it's in a much stronger position to expand compared to 2000.
It's more accurate to say offshoring existing U.S. technology, e.g. to China, is more productive to China than creating and shifting into new technology in the U.S., ceteris paribus.
ReplyDelete"Baby Boomers are retiring in record numbers, before they collapse"...
ReplyDeleteHere you go buddy: the number of people not in the labor force is back to all time highs: 87,897,000
"Again? It never went away but the housing market may be finding a bottom"...
The Second Foreclosure Tsunami Is Coming, And Is About To Kill Any Hopes Of A "Housing Bottom"
juandos,
ReplyDeleteThis is the notice I got when I clicked on your links:
"Disallowed Key Characters."
This seems to happen to any tiny URL you link to lately at tiny. Result: no other information displayed!
"Strong Gains in Manufacturing Jobs Continue"...
ReplyDeleteExcept in the industries financed by 'venture socialism...
Can you say: Ecotality?
buddy the first link takes me to a fed chart and the second link takes me to a Zero Hedge article...
ReplyDeletePray for a lower exchange rate on the dollar.
ReplyDeleteAs for liquidity, the Japanese tried that. You need sustained, progressive QE. Monetize the debt--just like Milton Friedman, John Taylor, Ben Bernanke, Frederic Mishkin and Alan Meltzer advocated that Japan do.
The Fed need to go to a sustained QE 3.
A real estate bust and Great Recession is no time for a timid, feeble, peek-a-boo Fed.
What are you babbling about pseudo benny?
ReplyDeleteYeah! Screw the peek-a-boo Fed and bring in Gideon Gono!
ReplyDeleteDesperate times call for desperate distortion.
The U.S. population growth rate is about 1% per year, so *absolute* employment numbers which increase at a rate of 1%/yr are simply keeping pace with the population, and will - all other things being equal - keep unemployment and labor participation rates constant. For instance, the "total payroll employment" increase of 2.7% in 2.25 years in the graph at at the top equates to an annual absolute growth rate of 1.2%, which is nearly stationary relative to population growth.
ReplyDeletePeak,
ReplyDelete"(note, offshoring reduces U.S. productivity and raises productivity offshore)."
If I reduce the cost of my inputs for the same output, I am more productive. It doesn't matter where that lower cost occurred. Would I be more productive if I lowered my cost for a part by having it made in Nevada instead of Wyoming?
"U.S. manufacturing produced more output with fewer inputs, particularly since 2000 (do you prefer more wealth or more work?)."
Is that, then, an endorsement of offshoring?
"Yeah! Screw the peek-a-boo Fed and bring in Gideon Gono!
ReplyDeleteDesperate times call for desperate distortion."
LOL.
I knew I had heard that name before, but I had to look it up. Gotta love this from Wiki:
"There were a host of problems before he became governor, hence the appointment of a turnaround strategist but they seemed to be too much even for him to tackle and the decline of the economy continued:"
His best approach might have been to announce that a central bank is the scourge of any economy, and the root cause of Zimbabwe's problems, and that his first two actions as governor would be:
1. Turn out the lights.
2. Lock the doors.
"The US is looking at a foreclosure crisis yet again."
ReplyDeleteAgain? It never went away but the housing market may be finding a bottom.
It is nowhere near a bottom in real terms. And all the meddling by Congress as well as title uncertainties prevented foreclosures. That is now over and the total of the shadow inventory plus mortgages that are two months behind is growing.
"Gasoline usage is falling."
Of course it is. From GM's latest earnings call with Don Johnson(VP US Sales):
"...consider this fact; just three short year's ago about 16% of the vehicles that we sold achieved at least 30 miles per gallon on the highway. Contrast that today where that number is closer to 40%."
The age of the vehicle fleet is as high it has ever been. That means that new sales are not significant yet. The energy efficiency claims may come into play but won't be material for several years into the future.
"Electricity use is down."
A very mild winter in the Midwest and East can do that, and it just did.
Yes, that helped. But real economic activity is also down.
"GM is stuffing the inventory channel."
The chart is a year old and when auto sales were beginning to take off.
The chart ends February 2012. Inventory is up 29% even though the mild winter conditions should have led to an increase in seasonal sales and caused inventories to decline.
"Labour participation rates have collapsed."
Baby Boomers are retiring in record numbers, before they collapse.
They don't have the savings to retire. The number of people who could work but are not because they can't find jobs is near record post-WWII highs.
VangIV,
ReplyDeleteHow does the GM month end dealer inventory compare to Toyota, their next closest competitor?
Ron H. says: "If I reduce the cost of my inputs for the same output, I am more productive."
ReplyDeleteYes, however, the costs of inventing and building new technology typically raise input costs, until the new technology is installed, operated, and maintained.
The U.S. creates more new technology than other countries, e.g. China.
VangelV,
ReplyDeleteThe chart that you originally posted was for March, 2011. Thanks for the update. Vehicle sales are still rising and so, it would follow that inventories should rise also.
On home foreclosures: I truly believe that home prices are finding a bottom, but there are a lot of homes that need to work their way through foreclosure.
None the less, Prof. Perry's stats on mfgr. employment are very hopefull for the overall economy.
The U.S. has maintained its global share of manufacturing output at around 20% with over 30% less labor since 2000. So, it's in a much stronger position to expand compared to 2000.
ReplyDeleteI do not believe that this is actually true. If you look at the real economy and actual manufacturing activity you would find that the US output numbers are grossly overstated and that labour and other input costs are understated.
juandos, in case you missed it in the other article, here is my response to your request for proof about March's average withholding tax receipts being 7% above last March's numbers:
ReplyDelete---------------------------------
juandos said: "O.K. unknown, I've read your nonsense now where's your proof?"
You asked for it, you got it. You're about to find out how much of a fool you are for calling my stuff nonsense.
Last year's data is from here:
Last year's Jan-March DTS
This year's data is from here:
Current Daily Treasury Statement issues
The amount of withholding is on "TABLE IV Federal Tax Deposits" about 2/3 down each text page. It's the first line entitled "Withheld Income and Employment Taxes" under the "Today" column.
First on each line below is the date, second is the amount of withholding taxes received on that date, in million $$.
March 2011
03/01: $15,414
03/02: $9,247
03/03: $2,247
03/04: $9,023
03/07: $15,209
03/08: $2,012
03/09: $6,261
03/10: $2,551
03/11: $6,301
03/14: $13,927
03/15: $6,869
03/16: $16,693
03/17: $2,178
03/18: $8,372
03/21: $10,965
03/22: $1,325
03/23: $5,555
03/24: $1,712
03/25: $4,447
03/28: $10,939
03/29: $1,323
03/30: $5,935
03/31: $3,576
-----------------------
Total: $162,081 million
Total / 23 days = $7,047 million average withholding receipts per day
March 2012
03/01: $16,099
03/02: $9,452
03/05: $13,790
03/06: $2,475
03/07: $8,844
03/08: $2,716
03/09: $5,523
03/12: $14,288
03/13: $1,900
03/14: $7,923
03/15: $6,748
03/16: $19,125
03/19: $11,292
03/20: $1,916
03/21: $7,959
03/22: $1,654
03/23: $5,112
03/26: $10,612
03/27: $2,095
03/28: $6,428
03/29: $2,620
03/30: $7,782
---------------------
Total: $166,353
Total / 22 days = $7,561.5 million average withholding receipts per day
2012's $7,561.5 million is 7.3% more than 2011's $7,047 million figure.
Next time I say I can prove something, I'd suggest you think twice before you doubt me.
How does the GM month end dealer inventory compare to Toyota, their next closest competitor?
ReplyDeleteI don't have the numbers any longer so I can't be sure. I know that last year the Toyota dealers had trouble with too little finished inventory but that was due to the tsunami related issues. GM clearly has problems in Europe and the US and cannot keep playing the channel stuffing game for all that much longer. I expect that in the next few years it will have to close factories in the US and Western Europe and move them to Asia, Mexico, and FSU countries.
The chart that you originally posted was for March, 2011. Thanks for the update. Vehicle sales are still rising and so, it would follow that inventories should rise also.
ReplyDeleteNot at all. Vehicles are selling because the excess product is forcing GM to offer huge discounts. And if you look at the data not all vehicles are the same. You need to sell three or four small cars to make the same profit as one large SUV or truck. And the last time I checked GM was supposed to be in the making profits business.
My guess is that the truth is likely to come out after the election. Keep in mind that in the current fascist environment GM is very dependent on its political sponsors and will do what is necessary to try to reelect the Führer.
On home foreclosures: I truly believe that home prices are finding a bottom, but there are a lot of homes that need to work their way through foreclosure.
I think that you are ignoring the homes that are current but under water. Given the advantage of not paying your mortgage I suspect that more and more people in such situations will start being late with their payments.
None the less, Prof. Perry's stats on mfgr. employment are very hopefull for the overall economy.
Dr. Perry tends to cherry pick data and not to look at it very closely. A perfect example is any data that has been seasonally adjusted to account for the colder winter months causing lower economic activity. Dr. Perry has ignored the fact that a much warmer winter means that the seasonal adjustments are not valid and overestimate the amount of economic activity. We should see that by June and July when the adjustments start to have a negative effect. Because of that it would not be a surprise to see downward revisions for the old data so that the seasonal adjustments can be gamed in the summer.
Peak,
ReplyDelete"Yes, however, the costs of inventing and building new technology typically raise input costs, until the new technology is installed, operated, and maintained."
My accountants handle that. The cost of new technology isn't expensed all at once when I buy it. I buy new technology to lower my costs over time, starting the minute I begin to use it.
Would you say that replacing a worn out tool with a new one that's exactly the same increases my input costs? If not, why would an improved, more efficient tool increase my costs?
I may not be the one bearing the initial cost of inventing and building new technology.
You may be doing double accounting again.
If you look at GM's inventory levels you discover that most of the increase in inventories is due to pickup trucks, which do appear to be over-stocked (something like a 124-day supply, which is a bit excessive). This aparrently isn't the case with regular passenger cars.
ReplyDeleteRon says "You may be doing double accounting again."
ReplyDeleteNo, you're just seeing double again. Inventing is part of and typically raises input costs.
Well unknown I applaud you for your ability to pick certain numbers out of all the data...
ReplyDeleteBTW regarding this: Last year's Jan-March DTS
The response was this: There are currently no Daily Treasury Statement (DTS) files available for the selected Fiscal Year. Please check back later...
Obviously something changed...
Sorry, I think I'll stick to Trim Tabs since its obvious this administration has been somewhat less than forthright on other numbers...
I don't know what the problem was, the link is working as I write this:
ReplyDeleteLINK
I did not pick "certain" numbers out of the data, I picked "all" of them for the two March's.