U.S. TRADE DEFICIT JUMPS SHARPLY IN DECEMBER
February 11, 2010 – Today in Manufacturing.net
Commerce Department said the U.S. trade deficit surged to a larger-than-expected $40.18 billion in December, the biggest imbalance in 12 months... continue the article at the following link. http://www.manufacturing.net/article.aspx?id=240782
INITIAL JOBLESS CLAIMS DROP MORE THAN EXPECTED
February 11, 2010Manufacturing.Net - By Christopher S. Rugaber, AP Economics Writer
WASHINGTON (AP) -- The number of newly laid-off workers seeking unemployment benefits fell more than expected last week to the lowest total in a month, a hopeful sign the job market may be improving.
The Labor Department said that first-time claims for unemployment insurance dropped by 43,000 to a seasonally adjusted 440,000. Wall Street economists expected a smaller decline of 15,000, according to a survey by Thomson Reuters.
A Labor Department analyst said the decline largely reflects the end of administrative backlogs in California and other states that had elevated claims in the previous three weeks. The backlogs represented claims that had built up over the Christmas holidays.
The winter storms that have pounded the Mid-Atlantic took place after last week's claims were filed, the analyst said. If they have an effect, it won't be evident until next week's data.
The four-week average fell by 1,000 to 468,500, the first drop after three weeks of increases.
Claims are now close to the low levels they reached in late December, when claims dropped to their lowest point in nearly 18 months.
Still, jobs remain scarce. The Labor Department said last week that the unemployment rate fell to 9.7 percent from 10 percent, but most analysts expect it to remain near 10 percent through the end of the year.
The number of people claiming benefits for more than a week, meanwhile, fell by nearly 80,000 to 4.5 million. That was a steeper decline than expected.
But the so-called continuing claims do not include millions of people who have used up the regular 26 weeks of benefits typically provided by states, and are receiving extended benefits for up to 73 additional weeks, paid for by the federal government.
Nearly 5.7 million people were receiving extended benefits in the week ended Jan. 23, the latest data available, down from nearly 5.9 million the previous week. The extended benefit data isn't seasonally adjusted and is volatile from week to week.
Among the states, Pennsylvania reported the largest increase, of nearly 10,5000, which it attributed to layoffs in the construction and service industries. Illinois, North Carolina, Georgia and Missouri had the next largest increases.
New Jersey reported the largest drop, of 1,819, which it said was due to fewer layoffs in services. Kansas, Connecticut, Virginia and Puerto Rico had the next largest drops.
WHITE HOUSE EXPECTS 95,000 MORE JOBS PER MONTH
February 11, 2010Manufacturing.Net - Philip Elliott, Associated Press Writer
WASHINGTON (AP) -- The U.S. is likely to average 95,000 more jobs each month this year, while personal savings will remain high as credit remains tight, according to a White House report released Thursday.
The Council of Economic Advisers also trumpeted the $787 billion economic stimulus package, which it said has saved or created about 2 million jobs.
In a message to Congress, President Barack Obama pointed out that the economy he inherited was losing 700,000 jobs each month.
"I can report that over the past year, this work has begun. In the coming year, this work continues," Obama said in a letter he sent to the Capitol attached to his economic update to lawmakers. "But to understand where we must go in the next year and beyond, it is important to remember where we began one year ago."
Casting its first year as positive, the administration's 462-page report served as a summary of its logic and a pitch for Obama's future agenda.
Recognizing voters were likely to hold Obama to account for the economy, the White House team cast blame on their predecessors and unpopular Wall Street bankers.
"I think there's just no way to understate how huge the economic challenges facing the country have been this past year," said Christina Romer, head the Council of Economic Advisers. "So everything obviously from the financial crisis, the terrible recession, but the longer-run problems -- the stagnating middle-class incomes, soaring health care costs, the failure to invest in education, innovation, clean energy -- we certainly inherited an economy with a number of economic problems."
It's not clear whether the it-didn't-break-on-my-watch message would resonate with voters. Republicans were quick to describe the document as propaganda masquerading as governing.
"The Obama administration's report is full of blame for the policies of years past, praise for its own failed policies of the past year and promises about their ideological agenda to grow government," Republican House Whip Eric Cantor of Virginia said.
"Instead of praising themselves and blaming others, a greater focus on small businesses and smart solutions to reduce uncertainty and create jobs would be welcomed and is long overdue," Cantor said.
Indeed, even adding an average of 95,000 jobs each month, unemployment is likely to remain around 10 percent through this year and not fall below 6 percent until 2015. And while Americans are likely to save more for big-ticket items such as homes or cars, it means a slower recovery for a nation that has lost 8.4 million net jobs since this recession began in December 2007.
Obama's economic report predicts the economy could grow at a rate of 2.5 percent, in line with what the administration's economists predicted last year.
Mark Zandi, founder of Moody's Economy.com and a frequent adviser to lawmakers, said the White House economic projections track his own. A jobs bill worth $100 billion to $150 billion, he said, would accelerate a decrease in unemployment.
That also lines up with a bipartisan Senate proposal that promises to add 80,000 to 180,000 jobs over a year.
"If we go back into recession it will be very difficult to get out of it," said Zandi, who advised Obama's rival, John McCain, in the 2008 presidential election.
It will be even tougher if Americans continue to save at high rates -- somewhere in the 4 percent to 7 percent range -- as the White House report predicts they will until the financial services sector eases lending.
The report put it more bluntly: "A full economic recovery is unlikely until and unless the financial system is repaired."
That pressures Congress to take action on the regulatory changes Obama has pushed to address weaknesses in the financial system that led to the 2008 financial crisis. The legislation aims to increase consumer protections on loans and credit cards, add restrictions to previously unregulated financial products and find ways to dismantle failing firms without resorting to taxpayer bailouts.
WASHINGTON PUSHES NEW REQUIRED EMPLOYEE BENEFIT
February 11, 2010 – BusinessBrief.comA new government study shows how few people save enough for retirement. The president and some members of Congress are pushing legislation to change that — and to involve businesses in the solution, whether or not you want to be involved.
To start things off, the Government Accountability Office released figures showing about six out of every 10 low-income workers have almost no retirement savings and only about two out of every 10 workers in general have retirement accounts with their employers. President Obama and some members of Congress want to change that by requiring businesses to enroll workers in the equivalent of a Roth IRA — but with a small tax credit — funded by payroll deductions.
Workers could opt-out of the plan, and businesses wouldn’t be required to make any matching contributions. What would be required of businesses: administration and recordkeeping for eligible employees in the plan, including contract workers?
The National Small Business Association has voiced its objections to the plan mainly that it adds to the costs of doing business, especially for companies that right now don’t have a direct-deposit setup and don’t farm out payroll services.
SEC PROVIDES GUIDANCE FOR EXISTING PUBLIC COMPANY DISCLOSURE REQUIREMENTS REGARDING THE IMPACT OF CLIMATE CHANGE
February 11, 2010 - By Armin Sarabi and Lucy Stark – Holland and Hart
On February 2, 2010, the Securities and Exchange Commission (SEC) published an interpretive release (available here on SEC's website) intended to provide guidance on certain existing disclosure rules that may require a company to disclose the impact that business or legal developments related to climate change may have on its business. The release states that it is not intended to create new disclosure obligations, but rather is designed to clarify already existing SEC disclosure rules that require public companies to describe impacts of climate change and climate change related issues.
Click the following link for the full article http://www.hollandhart.com/newsitem.cfm?ID=1599
INDUSTRIES THAT WON’T BE COMING BACK
February 11, 2010 - Bob Hill – BusinessBrief.com
The recession has forced the loss of more than 7 million jobs, doubling the unemployment rate and crippling 10% of the workforce. While some of those positions will return as the recession lifts, here are five sectors where experts predict a lot of the jobs will not be coming back: More at the following link. http://www.businessbrief.com/industries-that-wont-be-coming-back/#more-6614
CHINA CURBS UNAUTHORIZED STEELMAKING
February 11, 2010 – Today in Manufacturing.net
World's biggest steel producer says it will crack down on unauthorized steel mills as it maneuvers to wield more control over prices during crucial iron ore talks... continue the article at the following link. http://www.manufacturing.net/article.aspx?id=240758
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