Posts for September 27, 2010

September 27, 2010

Following a moderately positive report the prior week, last week's economic news was neutral. Of the six major indicators, two worsened, two were unchanged and two improved. (To see all of last week's reports, see the Latest Economic Reports section below.) Much of the news last week surrounded the housing sector. After falling off significantly from April to July, August reports on housing starts, permits and home sales showed that conditions stabilized.

More recently, after showing signs of improvement in prior weeks, new claims for unemployment shot up to 465,000 for the week ending September 18. This brings the September average to 458,000 through the first three weeks of the month, only slightly better than the August average of 487,000.

A worrisome sign for manufacturers is that new durable goods orders fell 1.3 percent in August. Much of the decline was due to a huge drop in aircraft orders, which are extremely volatile from month to month, causing some to call the report encouraging. While it is true that most other industries reported increases in orders in August, a longer perspective shows that conditions are softening for manufacturers, not firming.

As the green bars in the chart above show, new orders for nondefense capital goods (excluding aircraft) -- a good bellwether of business investment -- rose at an annual rate of 8.8 percent during the three months ending in August, a significant slowdown from the 39 percent pace during the three months ending in May. While it appears that business investment continues to grow in the third quarter, the pace is much slower than in the second quarter and one of the reasons the economy remains stuck in low gear.

Dave Huether

Chief Economist

National Association of Manufacturers

UMA MEMBERS IN THE NEWS

SWEET CANDY COMPANY RECIEVES SHARP RECOGNITON

September 2010 - The UOSH Safety Line

Sweet Candy Company is a family-owned and operated company that has been in business since 1892. The company specializes in the production and distribution of more than 250 quality candy items nationally and internationally. The company moved its operations in Portland, Oregon to Salt Lake City in 1900 and finally to its current location in 1999.

In 2003, Sweet Candy Company had the distinction of being Utah Occupational Safety and Health’s first recipient of the prestigious SHARP award. The SHARP (Safety and Health Achievement Recognition Program) award is a formal recognition of small employers that are able to establish and maintain an outstanding safety and health management system as well as maintain employee injury/illness rates lower than the national average for their industry. Since 2003, Sweet Candy Company has maintained a tradition of excellence in preserving that strong safety culture established so many years earlier. On December 5, 2009, the company was officially granted approval for SHARP status, this being their third renewal! Sweet Candy Company was recognized for this achievement in a ceremony at their facility on August 3, 2010. The Labor Commission would like to once again congratulate this outstanding company for their achievement and continued efforts to maintain a safe and healthful working environment for their employees.

STATE OF UTAH RETAINS AAA BOND RATING, COMPLETES HISTORIC BOND SALE

September 27, 2010 – UB Daily
Utah Governor Gary R. Herbert and Treasurer Richard K. Ellis announced the recent affirmation of the State’s “AAA” bond rating and the completion of a landmark $1 billion general obligation bond sale, which secured record-low borrowing costs for the state.
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STIMULUS HAS NOT PRODUCED PROMISED JOBS.

September 27, 2010 - McClatchy
McClatchy reports, "More than a year and a half after Congress passed a massive plan to stimulate the economy and get Americans working, California has yet to start 41 percent of its highway projects. ... While some states have put their money to work quickly, others chose projects that have been slower to produce jobs, and so the nation is far from fulfilling President Barack Obama's prediction that the highway stimulus dollars would create or save 150,000 jobs by the end of this year. So far, according to an analysis of White House data, the highway stimulus spending has produced about 92,000 jobs."

WTO SEES RECORD GLOBAL TRADE GROWTH IN 2010

September 27, 2010 - World Trade Center Utah
The World Trade Organization on Monday raised its trade growth forecast for 2010 to 13.5 percent from 10 percent, describing the pace as the fastest-ever annual expansion in global commerce.
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