Business activity expanded at a solid rate in New York State, according to firms surveyed in the February 2017 Empire State Manufacturing Survey. Other reported findings included:
The headline general business conditions index rose twelve points to 18.7, its highest level in more than two years. The new orders index climbed to 13.5, and the shipments index advanced to 18.2, pointing to substantial increases in both orders and shipments. The unfilled orders index rose above zero for the first time in more than five years. Delivery times were reported as longer, and inventories increased. Labor market conditions improved, with both employment and hours worked moving higher. After reaching multiyear highs last month, the prices paid and prices received indexes were little changed. Indexes assessing the six-month outlook continued to convey a high degree of optimism about future conditions.
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Upstate CEOs are not feeling optimistic about the business policies likely to come out of the state Capitol during the 2017 legislative session, a new poll shows.
A Siena College/state Business Council poll shows that 61% of upstate CEOs surveyed in the final quarter of 2016 believe the state is currently doing a poor job of creating a business climate that promotes success. What’s worse: 84% of CEOs lack confidence that state government will improve the business climate in 2017.
CEOs are more optimistic about the chances the federal government will improve business climate, though they still aren’t overwhelmingly sure. 66% say they aren’t confident that positive changes are on the horizon. Read more.
Stephen Gold, the President and Chief Executive Officer of the Manufacturers Alliance for Productivity and Innovation (MAPI), has written a rundown of why America’s manufacturing sector hasn’t yet recovered from the Great Recession. He cites three main reasons:
Uncertainty at home. Annual capital investment continues to lag behind the averages of the post-war era, as does R&D investment – two of the most important catalysts for innovation and growth. One reason is that business leaders have entered a prolonged period of uncertainty over many factors critical to such decisions.
Stagnant economic conditions abroad. As sluggish as our own economy has been, with 1.5% GDP growth projected for 2016 and a MAPI Foundation forecast of 2.0% for 2017, we appear to be leading the stagnant pack. The World Bank estimates that global growth – including emerging markets – attained a post-recession low of 2.3% in 2016.
Collapse of oil and gas prices. As high energy prices can provide a shock to the economy (remember the summer of 2008?), so can the reverse: when prices fall below a certain threshold, companies stop investing in equipment, R&D and people.
In December 2016, New York State’s private sector job count increased by 9,000, or 0.1%, to 7,963,900, a new record high, according to preliminary figures released by the New York State Department of Labor. Those figures bring the statewide unemployment rate down to 4.9% from 5.1%. Since the beginning of Governor Andrew M. Cuomo’s administration, New York State’s economy has added 869,600 private sector jobs and experienced employment growth in 61 of the past 72 months. The good news did not extend to New York manufacturers though, which lost 9,900 jobs between December 2015 and December 2016.
A supplemental survey from the Federal Reserve Bank of New York found that New York manufacturers were facing longer waits in filling job opening. When asked how the intervals between posting a job opening and filling it, 38 percent of manufacturers reported that the duration of job vacancies had increased compared with their experience in 2015. Businesses were also asked how much they expected the wage or salary of a typical worker (not including benefits) to change over the next twelve months. Roughly 74 percent of manufacturers expected salaries to increase. Read the full report.
Yes it is that time of the month again, the Federal Reserve Bank of New York has released its monthly survey of New York manufacturers. The results showed modest growth while labor conditions remained weak, in keeping with the results from last year’s surveys. The new orders index fell to 3.1, pointing to a small increase in orders, and the shipments index held steady at 7.3. Inventories edged higher for the first time in more than a year. Manufacturers reported a slight decline in employment and somewhat shorter workweeks. Both input prices and selling prices increased more rapidly this month, with the prices paid index climbing to its highest level in nearly three years, and the prices received index also jumping to a multiyear high. Read more.
Optimism soared among small business owners in December, with confidence levels the highest since 1980 as expectations about the economy’s prospects improved dramatically in the aftermath of the presidential election. The National Federation of Independent Business’s index jumped 7.4 points last month to 105.8, the highest since the end of 2004, from 98.4. While seven of the 10 components increased in December, 73 percent of the monthly advance was due to more upbeat views about the outlook for sales and the economy, the Washington-based group said. Read more about it.
Hidden Figures, the drama about the black female mathematicians who played a pivotal role in the space race behind the scenes at NASA, has been the number one movie in America for two weeks now, so it seems an ideal time to bring up the role a little local business called IBM plays in the film. Yes, an IBM mainframe computer plays a large part in the film, and those mainframes were manufactured right here in Poughkeepsie. IBM has teamed up with studio behind the movie to put together an extensive look at its role in the Hidden Figures story.
The Atlantic has published a very thorough look at the current state of the Manufacturing industry in America. If you’re looking for an interesting weekend read, we recommend you check it out:
As some types of manufacturing disappear in America—manual jobs that can be performed in places like Mexico where there are lower wages, and repetitive ones that can be automated—other types are growing. So-called advanced manufacturing, which is highly specialized and requires a facility with computers, is actually expanding. The U.S. economy will need to fill 3.5 million skilled manufacturing jobs over the next decade, the White House says. This is an industry that employs skilled and educated workers such as engineers and scientists. It’s also an industry that adds significant value to the economy. Manufacturing output continues to rise in the U.S., and the average factory worker makes $180,000 worth of goods every year, more than three times what he produced in 1978.