Daily Briefing – 375

Post: Sep. 15, 2021

Empire State Manufacturing Survey: Growth “at a Swift Pace”

Business activity grew at a swift pace in New York State, according to firms responding to the September 2021 Empire State Manufacturing Survey. The headline general business conditions index climbed sixteen points to 34.3. New orders, shipments, and unfilled orders all increased substantially. Looking ahead, firms remained very optimistic that conditions would improve over the next six months, and capital spending and technology spending plans increased markedly.

The index for number of employees rose eight points to 20.5,
The average workweek index increased fifteen points to 24.3, pointing to strong gains in employment and hours worked.
The prices paid index held steady at 75.7,
The prices received index edged up two points to 47.8, marking its third consecutive record high.
The new orders index rose nineteen points to 33.7,
The shipments index shot up twenty-three points to 26.9, indicating strong growth in both orders and shipments.
The unfilled orders index rose to 20.9.
The delivery times index moved up to a record high of 36.5, indicating significantly longer delivery times.

FDA Scientists Strike Skeptical Tone on Need for Booster at This Time, Likely Fueling Debate

Food and Drug Administration scientists have expressed skepticism about the need for additional doses of Pfizer’s Covid-19 vaccine for all people who have received it. The assessment by the agency’s staff, included in documents released Wednesday, sets up a high-stakes debate over who will need an additional booster dose — and when they will need it — at the meeting of experts being convened by the Food and Drug Administration on Friday.

In the documents, the FDA’s own scientists seemed to strike a cautious position about the need for widespread booster shots. Overall, they said, “data indicate that currently US-licensed or authorized COVID-19 vaccines still afford protection against severe COVID-19 disease and death in the United States.” any decision by the FDA that limits the approval for booster shots, or even expresses hesitancy about how they should be used, will be seen as a rebuke to the Biden administration, which in August took the unusual step of unveiling a plan to offer boosters to the U.S. population, ahead of decisions from the FDA and the CDC.

Americans’ Incomes Fell in 2020

An annual assessment of the nation’s financial well-being, released Tuesday by the Census Bureau, offered insight into how households fared during the pandemic’s first year. Americans last year saw their first significant decline in household income in nearly a decade with economic pain from the Covid-19 pandemic prompting government aid that helped keep millions from falling into poverty.

Median household income was about $67,500 in 2020, down 2.9% from the prior year, when it hit an inflation-adjusted historical high. It came as the U.S. last year saw millions lose their jobs and national unemployment soar from a 50-year low to a high of 14.8%. The last time median household income fell significantly was 2011, in the aftermath of the 2007-09 recession.

CEO Salaries Declined in 2020

CEO salaries declined in 2020, as companies enacted cuts to preserve liquidity and show solidarity with workers. But those cuts were offset by surging stock compensation, fueled by a rising stock market. The end result: median CEO pay for S&P 500 CEOs rose slightly—about 2.5%—while median pay for Russell 3000 CEOs was down barely, 0.1%.

That’s the finding of an annual study by The Conference Board, along with ESGAUGE and Semler Brossy. Median salaries among S&P 500 CEOs fell 4.2%, and median salaries among Russell 3000 CEOs fell 6.4%. • Stock options soared as a share of CEO pay, accounting for 19.1% of total pay in 2020, up from 11.1% in 2019.

Read the report a The Conference Board

US COVID-19 Update – U.S. Moves to Prevent Shortage of Therapy Drugs

The Biden administration has sought to avert shortages of monoclonal antibodies this week as an analysis published Tuesday found that treating the nation’s hospitalized, unvaccinated population topped an estimated $5.7 billion.

As of Monday, the federal government has taken over distribution of monoclonal antibody treatment and has purchased 1.4 million additional doses — a move likely to reduce the medication in parts of the country with high infection rates. The new move will temporarily allow the U.S. Department of Health and Human Services to implement rules for distribution of the critical covid-19 therapy instead of permitting states, medical facilities and doctors to order them directly.

NYS Vaccine and COVID Update

Vaccine Stats as of Wednesday September 15th:

One Vaccine Dose

69.3 of all New Yorkers – 13,434,333 (plus 30,477 from a day earlier)
In the Hudson Valley 1,418,246 (plus 2,544)

Fully Vaccinated

61.9% of all New Yorkers – 12,039,998 are fully vaccinated (Plus 24,321)
In the Hudson Valley – 1,256,815 (plus 2,476) are fully vaccinated.

The Governor updated COVID data through Tuesday September 14th. There were 31 COVID related deaths for a total of 56,139.

Hospitalizations:

Patients Currently in Hospital statewide: 2,424.

Seven Day Average Positivity Rate:

Statewide 3.11%
Mid-Hudson: 3.57%

Useful Websites:

Federal Court Issues TRO Enjoining Omission of a Religious Exemption from the Emergency Public Health Vaccination Regulations

The federal District Court for the Northern District of New York issued a temporary restraining order (TRO) on Sept. 14, 2021, enjoining New York State officials from enforcing emergency regulations imposing a vaccination mandate for certain healthcare workers to the extent that the regulations do not allow for a religious exemption to the mandate. The emergency regulations, which were issued on August 26 by the Public Health and Health Planning Council under the New York State Public Health Law, apply to hospitals, nursing home and home health agencies, among other entities. The emergency regulations were notable for not including provisions for a religious exemption or any test out provisions.

The court’s TRO places the lack of a religious exemption provision on hold, pending the outcome of the proceeding. The TRO goes into effect immediately, although the court noted that the TRO will not have practical effect until September 27, which was the earliest date for a vaccination requirement under the regulations.

Pfizer CEO Says COVID Vaccine Data for Kids Under Age 5 May Come in Late October

Pfizer expects to release clinical trial data on how well its Covid-19 vaccine works in 6-month to 5-year-old children as early as the end of October, CEO Albert Bourla said Tuesday. Vaccine data for kids between ages 5 and 11 will come much sooner, he said, potentially ready to be submitted to the Food and Drug Administration by the end of this month.

“Then, it is up to the FDA to take their time, and then make a decision,” Bourla said during an interview at Research!America’s 2021 National Health Research Forum. The CEO’s comments come as many parents say they are anxious to get their children vaccinated, especially as schools reopen and the highly contagious delta variant continues to spread.

Europe’s Manufacturing Recovery Continues

Euro-zone manufacturing may at last be on the up. Data released by Eurostat yesterday showed that industrial production grew by 1.5% in July. That was significantly higher than analysts’ expectations, and means industrial production has now returned to its pre-pandemic level.

Surveys of purchasing managers by IHS Markit have been indicating strong growth in manufacturing output throughout the summer. But they have also highlighted record backlogs of new orders and slow delivery times, suggesting supply has struggled to keep pace with growing demand. Last week Christine Lagarde, the president of the European Central Bank, said the bloc was “on track for strong growth in the third quarter”.

China’s Factories, Retailers Stumble on COVID-19 Disruptions

The growth of retail sales in China slowed to 2.5% in August, year-on-year, falling far short of an expected 7%. Industrial growth decelerated too, from 6.4% in July to 5.3%. China’s zero-tolerance approach to controlling COVID-19 poses acute difficulties to retailers; this week relatively small outbreaks in the commercial powerhouse of Fujian province provoked lockdowns affecting millions.

The world’s second-largest economy has made a remarkably strong revival from last year’s coronavirus-led slump, but momentum has slowed over the past few months due to supply chain bottlenecks, semiconductor shortages, curbs on high-polluting industries and a crackdown on property investment.

UK Sees Record Jump in Annual Inflation

Inflation in the United Kingdom rose to 3.2 percent in the past 12 months through August, a Wednesday report from the Office for National Statistics said. The report added that “this is likely to be a temporary change” amid the recovery from the coronavirus pandemic.

This figure is up from 2 percent in July, marking the largest increase seen since the Consumer Prices Index began measuring inflation in 1997, the report said. Because the increase is more than 1 percentage point, Andrew Bailey, the governor of the Bank of England, will have to officially explain it in a letter to Treasury chief Rishi Sunak, in accordance with the Bank of England’s policies.

Machine Tool Demand Slows to Start Q3

U.S. manufacturers and machine shops ordered $472.6 million worth of new capital equipment during July, -5.6% less than the June total but only the second decrease in monthly orders this year. The July result also represents a 41.5% increase over the July 2020 total, as manufacturers continue to invest in reaction to building industrial demand.

For the current year to-date, new orders for machine tools total $2.99 billion, which is 48.1% higher than the order volume for January-July 2020.

Curtains Up: Broadway Reopens

New York quicksteps, foxtrots and pirouettes towards theatre heaven today as Broadway opens at full capacity for the first time since March 2020. Several blockbuster musicals, including “Hamilton”, “Wicked”, “The Lion King” and “Chicago”, will restart performances immediately. Previews for “Six”, “Chicken & Biscuits” and “Is This A Room” begin later this month. Before they can get their toes tapping, visitors (as well as performers and backstage staff) will have to provide proof of full vaccination. Patrons unable to do so will be asked to produce evidence of a negative covid-19 test.

Broadway had enjoyed its best season ever before the pandemic struck. In 2018-19 theatres welcomed 14.8m visitors; Broadway contributed an estimated $14.7bn to New York’s economy and provided almost 97,000 jobs. But, perhaps fearing the fast-spreading Delta variant, audiences are not rushing back to their seats. Tickets for “Hamilton”—in the past sold out months in advance—are still widely available.

Read all about it at the New York Times

High Steel Prices Have Manufacturers Scrounging for Supplies

Manufacturers are facing the highest steel and aluminum prices in years, another hurdle for U.S. companies already struggling to make enough cars, cans and other products. A Midwest steel index calculated by CRU Group estimated prices at $1,940 a ton at the start of September, up from around $560 in September for both 2019 and 2020. A U.S. government index tracking the price of steel and iron nearly doubled in August from the year before, the biggest relative increase since records began in the 1920s.

Rapidly increasing metal costs are pushing manufacturers to take what steel they can get and hire more people to seek out available supplies, company executives said. The rising costs are flowing through to some producers of consumer goods: Campbell Soup Co. is paying more to get the cans it fills with tomato soup; Peloton Interactive Inc. is seeing prices rise for parts that go into its stationary bikes; and Steelcase Inc. is paying more to make metal desks and filing cabinets. Car makers like Ford Motor Co. and General Motors Co. are also dealing with rising metal prices.

Boeing Projects Market Growing to $9T

Boeing Co. issued an annual forecast of aircraft markets for the next ten years, projecting a growing market it values at $9 trillion based on a rebounding commercial aircraft sector, growing demand for cargo aircraft, and continued demand for aircraft services across the commercial, business, general aviation, and government aircraft sectors.

The $9-trillion estimation improves on the 10-year/$8.5-trillion outlook Boeing offered in its 2020 Boeing Market Outlook, and on the 10-year/$8.7-trillion assessment in 2019 – prior to the pandemic-related contraction of commercial aviation activity. Boeing foresees a 10-year (2021-2030) global demand for 19,000 commercial airplanes, valued at $3.2 trillion; and a 20-year (2021-2040) global demand for over 43,500 new airplanes, valued at $7.2 trillion. The 20-year figure shows an increase of about 500 aircraft over the 2020 Commercial Market Outlook.

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