Daily Briefing – 418
U.S. Factory Orders Rise More Than Expected in October
The Commerce Department said on Friday that factory orders increased 1.0% in October. Data for September was revised higher to show orders gaining 0.5% instead of 0.2% as previously reported. Orders increased surged 17.1% on a year-on-year basis. Shipments rose 2.0% after advancing 1.0% in September. Inventories at factories gained 0.8% in October. Unfilled orders rose 0.3% after increasing 0.7% in the prior month.
The Commerce Department also reported that orders for non-defense capital goods, excluding aircraft, which are seen as a measure of business spending plans on equipment, increased 0.7% instead of 0.6% as reported last month. Shipments of these so-called core capital goods, which are used to calculate business equipment spending in the gross domestic product report, rose 0.4%. They were previously reported to have increased 0.3%.
ISM: U.S. Service Sector Activity Hits Record High in November
The Institute for Supply Management said on Friday its non-manufacturing activity index increased to 69.1 last month, the highest reading since the series started in 1997, from 66.7 in October. A reading above 50 indicates growth in the services sector, which accounts for more than two-thirds of U.S. economic activity.
The ISM’s measure of services industry employment increased to a seven-month high of 56.5 from 51.6 in October. That offered hope that a pandemic-related labor crunch, which has hampered faster job growth, could be starting to ease. The survey’s measure of supplier deliveries was unchanged at a high 75.6. Longer delivery times accounted for some of the surprise increase in the services index. They are normally associated with a strong economy and increased customer demand, which would be a positive contribution to the ISM non-manufacturing index.
Senate Leaders Face Pushback on Tying Debt Fight to Defense Bill
Senate leadership is facing bipartisan pushback over one option floated for raising the country’s debt ceiling: tying it to a sweeping defense bill. The path has potential benefits. By tying a deeply partisan debt limit fight to the National Defense Authorization Act (NDAA), which typically passes with wide bipartisan support, leadership takes two items off of Congress’s packed year-end to-do list ahead of a Dec. 15 deadline for taking action on the borrowing limit.
Both House Majority Leader Steny Hoyer (D-Md.) and House Minority Leader Kevin McCarthy (R-Calif.), who agree on little these days, are warning that a defense bill that includes a debt ceiling hike would struggle to clear their chamber. “We’ve told the Senate that. That’s the reality. Those are the numbers,” Hoyer said.
‘Bona Fide American Hero’ Former Senator Bob Dole Dies at 98
Mr. Dole was a fixture on the Washington scene for more than half a century and a national leader of the Republican Party for nearly as long. As a legislator, and ultimately as leader of the Senate, he played a role on a staggering list of legislation touching every aspect of American society: voting rights, Social Security, food stamps, child-nutrition programs, the rights of the disabled, the North American Free Trade Agreement and more. As Congress’s chief tax writer, he was instrumental in the landmark Reagan-era tax cuts as well as in an overhaul of the nation’s tax code in 1986.
Dole was also a celebrated war veteran, having served in Europe during World War II. He was seriously injured in 1945 after being caught in a German machine gun attack, which left him temporarily paralyzed from the neck down. He is survived by his wife, Elizabeth Dole, and his daughter, Robin Dole.
US COVID Update –
The US CDC reports 48.5 million cumulative COVID-19 cases and 780,131 deaths. The current daily incidence average is approximately 80,230 new cases per day and appears to be holding relatively steady since mid-November, although there may be reporting delays due to the Thanksgiving holiday. Daily mortality appears to have dropped over the holiday—likely due to lags in reporting—but appears to be rising again, with the US currently averaging 816 deaths per day.
The US has administered 462.3 million cumulative doses of SARS-CoV-2 vaccines. The daily vaccination trend reached a recent peak at 1.44 million doses on November 23 but has declined sharply to 1.03 million doses as of November 26. There are 233.6 million individuals who have received at least 1 vaccine dose, equivalent to 70.4% of the entire US population. Approximately 71.2% of adults are fully vaccinated. Since August 13, 41.9 million fully vaccinated individuals have received an additional or booster dose, including 44.7% of fully vaccinated adults aged 65 years or older.
Read more at the Johns Hopkins Center for Health Security
NYS Vaccine and COVID Update
Vaccine Stats as of Sunday December 5:
One Vaccine Dose
- 79.1 of all New Yorkers – 15,025,822 (plus 20,385 from a day earlier).
- In the Hudson Valley 1,577,065 (plus 1,373).
Fully Vaccinated
- 68.9% of all New Yorkers – 13,417,678 (plus 26,815).
- In the Hudson Valley – 1,378,469 (plus 2,119).
The Governor updated COVID data through Saturday December 4. There were 40 COVID related deaths for a total of 59,280.
Hospitalizations:
- Patients Currently in Hospital statewide: 3,236.
7 Day Average Positivity Rate – 7-day average of cases per 100K population
- Statewide 4.84% – 46.93 positive cases per 100,00 population
- Mid-Hudson: 4.51% – 40.14 positive cases per 100,00 population
Useful Websites:
Scientists Push Back Against Idea that Omicron is More Dangerous than Other COVID Variants
Vaccines seem to be effective against the new variant, GlaxoSmithKline and the World Health Organization found, and scientists around the world reiterated that there is no evidence the Omicron variant is more deadly than previous strains. GlaxoSmithKline reported Thursday that in early testing, COVID-19 antibody treatment were effective against new mutations found in the variant, and that they were now conducting in vitro testing to confirm this further.
“Currently, there is no reason for panicking, as we don’t see severely ill patients,” Dr. Angelique Coetzee, chair of the South African Medical Association, told the Telegraph. Meanwhile the WHO, which only labeled the variant a “mutation variant of serious concern” last Friday, has now said that vaccines are likely to protect against severe cases. “We still need to find out if there’s any loss of protection, but we think vaccines will still protect against severe disease as they have against the other variants,” WHO chief scientist Soumya Swaminathan said.
Biden’s Winter COVID Plan
President Joe Biden on Thursday said his plan to fight Covid during the winter months will not include new lockdowns or an expansion of the administration’s current vaccination requirements. He said Thursday the administration’s goal is to keep schools open by launching hundreds of family vaccination clinics at community health centers and other locations around the country to make it easier for parents to immunize their kids.
The plan also includes an expansion of free at-home Covid testing. Americans with private insurance will be reimbursed for the tests, and the administration will distribute 50 million free tests to health centers and rural clinics for people who are uninsured or underserved, according to the president. he administration doesn’t believe additional measures are needed at the moment but is developing contingency plans to develop new vaccines and boosters if they’re needed to fight omicron.
Hochul Launches “Boost Up, New York” Campaign
Governor Hochul today launched the statewide “Boost Up, New York” campaign to urge New York adults to get their booster dose for better protection against COVID-19. In addition to getting a booster, the Governor and the State’s Department of Health encourage all New Yorkers to follow and share with others this important information for healthy holiday gatherings. Among the recommendations:
- All New Yorkers 18 and older who are two months past the Johnson & Johnson vaccine or 6 months past the Pfizer-BioNTech or Moderna initial vaccine series should get their booster dose.
- New Yorkers should get tested after traveling and before seeing family.
- All travelers, domestic and international, should continue to follow all CDC travel requirements.
- New Yorkers who don’t feel well should stay home.
- Wear masks in public indoor spaces and wash hands regularly.
U.S. Added Just 210,000 Jobs in November, Labor Force Participation Rises and Wages Up
The U.S. economy added a seasonally adjusted 210,000 jobs in November—the smallest gain since last December and a marked slowdown from an upwardly revised increase of 546,000 in October, the Labor Department said Friday. Almost 600,000 people joined the workforce, and the unemployment rate fell to 4.2% from 4.6%. The separate survey of households also released Friday showed strong progress in employment. That survey showed that 1.1 million more people were employed in November than in October. The labor-force participation rate rose to 61.8%, the highest level since March 2020 at the start of the pandemic.
Higher wages may be drawing people back into the workforce, economists say. Employers have complained of a shortage of workers and have been raising salaries and offering new benefits to entice new hires. Average hourly wages were up 4.8% in November from the previous year, roughly on par with October but well above annual growth rates before the pandemic which hovered around 3%.
Another 222,000 Individuals Filed Initial Unemployment Claims Last Week
Weekly jobless claims rose after setting a more than five-decade low last week. Still, however, new claims came in near pre-pandemic levels, highlighting ongoing improvements in the labor market.
- Initial unemployment claims, week ended November 27: 222,000 vs. 240,000 expected and a revised 194,000 during prior week
- Continuing claims, week ended November 20: 1.956 million vs. 2.003 million expected and 2.049 million during prior week
As of October, the civilian labor force was still down by nearly 3 million participants compared to February 2020 levels, according to Labor Department data.
Supplier Struggle in What Was Otherwise a Pretty Good Year in the Car Business
It has been a pretty good year for many in the car business. But one swath of the sector has largely missed out: parts suppliers. Suppliers typically do business with the car companies under fixed contracts that set prices for the length of a vehicle program—which can run longer than five years—and are difficult to renegotiate, executives and industry attorneys say. Auto-parts makers also rely on a steady flow of work orders and efficient, just-in-time supply chains to contain costs.
A recent survey by the Original Equipment Suppliers Association, a trade group, showed that sentiment among executives about next year’s outlook was at its second-lowest level since the financial crisis, better only than in spring of 2020.
Why It’s Difficult for Employers to Tell if a Vaccine Card is Forged
When Tampa Bay Buccaneers wide receiver Antonio Brown was accused by his former chef of procuring a fake Covid-19 vaccine card, it prompted a scramble by the National Football League to answer a seemingly simple question: Had Brown been vaccinated, as his card said he was, or not?
The NFL was able to make that determination despite a number of roadblocks that employers across the country face, even as vaccine mandates proliferate. And this high-profile instance of a forged card peels back the curtain on a surprising reality: It’s actually quite difficult in the U.S. to determine whether someone’s paper vaccination record is authentic—even for a mighty power like the NFL.
OPEC Plus To Continue Plan to Expand Output
OPEC decided it would stick with the plan to modestly increase oil output, even as the spread of the omicron variant raises questions about whether the pandemic could hit the global economy once again. But that pledge was a victory for the White House—U.S. President Biden has spent months publicly pressuring Saudi Arabia and other opec OPEC+ heavyweights to increase production in order to ease domestic energy prices.
Winter Safety from Head to Toe
unlike Santa, outdoor workers typically work year-round, rain, sleet, snow or shine with a similarly hectic schedule. So, an employer must take the time to prepare and educate workers about exposure to colder temperatures to avoid injuries and illnesses.
For outdoor workers, cold stress, hypothermia, frostbite, trench foot, and chilblains are the most common ailments. However, with the proper protection and training, winter-related injuries are preventable.
Goldman Sachs Cuts U.S. GDP Growth Forecast for 2022 Over Omicron Fears
Goldman Sachs on Saturday cut its outlook for U.S. economic growth to 3.8% for 2022, citing risks and uncertainty around the emergence of the Omicron variant of the coronavirus. Goldman economist Joseph Briggs said in a note that the Omicron variant could slow economic reopening, but the firm expects “only a modest drag” on service spending.
The firm now sees 2022 gross domestic product (GDP) growth of 3.8%, down from 4.2% previously on a full year basis, and Q4/Q4 growth of 2.9%, down from 3.3% before, Briggs said. “While many questions remain unanswered, we now think a moderate downside scenario where the virus spreads more quickly but immunity against severe disease is only slightly weakened is most likely,” he said. Worker shortages could last longer if people do not feel comfortable returning to work due to the variant, according to the note.
China Recertifies 737 MAX for Commercial Service
China’s civil aerospace regulator has cleared airlines to resume their operations with the Boeing 737 MAX, roughly a year after the U.S. Federal Aviation Administration and other such bodies in Canada, Europe, Brazil, and elsewhere recertified the aircraft’s flight-worthiness.
The 737 MAX is Boeing’s best-selling aircraft, a twin-engine narrow-body passenger jet. The program was grounded for 18 months – from March 2019 to November 2020 – as a result of two fatal accidents attributed to the flight control software overriding the crews’ actions. The aircraft was grounded and Boeing halted all deliveries in March 2019, though production of new aircraft continued.
Read more at American Machinist
What the Omicron Variant Means for the World Economy
The threat of a wave of illness spreading from one country to the next is once again hanging over the world economy, amplifying three existing dangers. The first is that tighter restrictions in the rich world will damage growth. The past week has shown that gates are slammed shut much faster than they are opened. The spread of Omicron is also likely to intensify limits on free movement at home. Europe was curbing many domestic activities even before the variant arrived, in order to fight surging infections of Delta.
A lopsided economy fuels the second danger, that the variant could raise already-high inflation. This risk looms largest in America, where President Joe Biden’s excessive fiscal stimulus has overheated the economy and consumer prices rose by 6.2% in October compared with the previous year, a three-decade high. You might think Omicron would lower inflation, by depressing economic activity. In fact it could do the opposite. Prices are rising in part because consumers are bingeing on goods, bunging up the world’s supply chains for everything from Christmas lights to trainers.