Payrolls Rose 390,000 in May – Some of the Data Below the Headlines
U.S. job growth cooled slightly in May, adding to signs the economy is starting to lose some steam after its rapid recovery last year. Employers added 390,000 jobs last month, a robust increase but down from a gain of 436,000 in April and below the monthly average pace of growth last year, the Labor Department reported Friday.
- Average hourly earnings increased 0.3% from April, slightly lower than the 0.4% estimate. The year-over-year increase for wages of 5.2% was in line with expectations.
- Labor force participation edged higher, rising to 62.3% though still 1.1 percentage points below February 2020.
- The labor force is smaller by 207,000 from February 2020
- Job gains were broad-based. Leisure and hospitality led, adding 84,000 positions. Professional and business services rose by 75,000, transportation and warehousing contributed 47,000, and construction jobs increased by 36,000.
- Other areas that saw notable gains included state government education (36,000), private education (33,000), health care (28,000),
- Manufacturing added 18,000
- Retail trade took a hit on the month, however, losing 61,000 in May.
Invasion of Ukraine Headlines
- Ukraine and Russia: the Latest News – Reuters
- Ukraine Come Up Short of World Cup Spot, As Wales Go Through – Sportnet
- Ukraine Counterattack Takes Back Parts of Strategic Donbas City – WSJ
- Russo-Ukrainian War in 100 Days: Compassion Fatigue is Here – Canadian News
- Explosions Rock Ukraine’s Capital Kyiv, Battle Rages on in East – Reuters
- Russian General Killed in Eastern Ukraine, Russian State Media Reporter Says – Reuters
- Ukraine Is Struggling to Export Its Grain, and Here’s Why – WSJ
- Biden Administration Planning to Sell Armed Drones to Ukraine: Report – The Hill
- Map – Tracking Russia’s Invasion of Ukraine – Live Universal Awareness Map
NYS Department of Health Updated Isolation & Quarantine Guidance
Late last week, the New York State Department of Health (DOH) updated their isolation and quarantine guidance to reflect changes made regarding children who are eligible for COVID-19 vaccinations in childcare and early childhood education settings.
Date for Special Election for Two Vacant NY Congressional Seats – August 23
Special elections will be held in New York to fill vacancies in the current 19th and 23rd Congressional Districts. Governor Kathy Hochul announced that special elections will be held on August 23rd following the resignations of Democrat Antonio Delgado and Republican Tom Reed.
Winners would serve until the end of the year. Those seeking re-election would need to run in the newly drawn Congressional district map in November. Primary elections for new State Senate and Congressional districts will also be held on August 23rd.
US COVID – Cases Appear to Have Peaked
The US CDC is reporting 84.2 million cumulative cases of COVID-19 and 1,002,422 deaths. The current average daily incidence appears to have peaked, falling to a 7-day moving average of 103,686 on May 31, down from a high of 110,350 on May 26. However, the decline could be due to delayed reporting attributable to the Memorial Day holiday. The average daily incidence on Memorial Day (May 30) this year is 5 times higher than the average reported on last year’s Memorial Day (May 31, 2021).
Prior to the holiday weekend, Our World In Data reported 7-day average US test positivity of 12%. The daily mortality dropped slightly to an average of 264 deaths per day, and we have not yet observed an increase corresponding to the surge in daily incidence. Hospital admissions of people with COVID-19 continue to trend upwards, although more slowly, with an increase of 6% over the past week. New cases continue to be driven by the the BA.2.12.1 sublineage of Omicron (59%), followed by the BA.2 subvariant (35%) and B.1.1.529 (6%).
NYS Vaccine and COVID Update –
Vaccine Stats as of June 3:
One Vaccine Dose
- 90.7% of all New Yorkers – 16,620,295
- In the Hudson Valley 1,728,722
- 77.5% of all New Yorkers – 14,914,852
- In the Hudson Valley – 1,524,002
- All New Yorkers – 8,569,648
- In the Hudson Valley – 1,038,542
The Governor updated COVID data through June 3. There were 22 COVID related deaths for a total reported of 71,670
- Patients Currently in Hospital statewide: 2,332
- Patients Currently in ICU Statewide: 221
7 Day Average Positivity Rate – Cases per 100K population
- Statewide 6.53% – 29.84 positive cases per 100,00 population
- Mid-Hudson: 7.54% – 31.94 positive cases per 100,00 population
Pfizer, BioNTech Seek FDA Authorization of COVID-19 Vaccine for Children Under 5
On June 1, Pfizer-BioNTech completed their request to the US FDA for Emergency Use Authorization (EUA) of their SARS-CoV-2 vaccine for children ages 6 months through 4 years. A SARS-CoV-2 vaccine for this age group is greatly anticipated, as children have been more affected during the Omicron variant surges compared to past surges. The US FDA acknowledged receipt of Pfizer-BioNTech’s application and said its experts will be evaluating the data. The FDA’s Vaccines and Related Biological Products Advisory Committee (VRBPAC) is scheduled to review EUA requests for both the Pfizer-BioNTech 3-dose vaccine regimen for children under age 5 and the Moderna 2-dose vaccine regimen for children under age 6 on June 15.
The under-5 age group is the only in the US that remains ineligible for SARS-CoV-2 vaccination. However, parents remain divided on whether to jump at the opportunity to vaccinate their children once the option becomes available or wait. A Kaiser Family Foundation survey conducted in April found that 18% of parents would vaccinate their under-5 children as soon as the series becomes available, 11% would do so only if required, 38% would “wait and see,” and 27% indicated they would “definitely not” vaccinate their young children.
Fed’s Lael Brainard Says Too Soon to Say If Inflation Has Peaked
Federal Reserve Vice Chairwoman Lael Brainard said she expected it would be appropriate for the central bank to raise interest rates by a half percentage point at its meeting later this month and again in July but said it was too soon to say whether the Fed might slow the pace of rate rises after that. Ms. Brainard said that it was premature to conclude that inflation had peaked and that the next several months of data on price pressures and economic activity would be important in determining whether the Fed continued to raise rates in September by a half percentage point or by the more traditional quarter-point increment.
“If we don’t see the kind of deceleration in monthly inflation prints, if we don’t see some of that really hot demand starting to cool a little bit, then it might well be appropriate to have another meeting where we proceed at the same [half-percentage-point] pace,” Ms. Brainard said during an interview on CNBC on Thursday. “If we are seeing a deceleration in the monthly prints, it might make sense to be proceeding at a slightly slower pace.”
Individual Income Tax Payments on Pace to Reach Record Level
Individual income tax collections are poised to reach $2.6 trillion, or 10.6% of the economy in the fiscal year that ends Sept. 30, according to the Congressional Budget Office. That is up from 9.1% in 2021 and would mark a record in the 109-year history of the tax, topping the war-tax receipts of 1944 and the dot-com boom of 2000.
It is individual income taxes—more so than corporate or payroll taxes—that are most notably above forecasts. Individual income taxes include those levied on wages, capital gains from investments and business profits reported on owners’ personal tax returns. Normally, income tax collections echo the broader economy, so money coming into the government alongside tax returns reflects what happened during 2021.
Citing Strong Dollar Microsoft Cuts Earnings and Revenue Guidance
The software giant said in a securities filing Thursday that it now expects fiscal fourth-quarter sales of between $51.94 billion and $52.74 billion, down from its prior guidance of $52.4 billion to $53.2 billion. The quarter ends June 30. Earnings are expected to be between $2.24 a share and $2.32 a share, down from prior guidance of $2.28 a share to $2.35 a share.
Economic weakness in other parts of the world has helped propel the U.S. dollar to multidecade highs against its trading partners, which comes as U.S. inflation is at or near its highest level in nearly 40 years. A strong dollar allows Americans to buy goods from other countries at lower prices. But it can also hurt U.S. manufacturers by making products more expensive for foreigners, and it means U.S. businesses receive fewer dollars for their exports.
Pandemic Disrupted Learning For U.S. Teens, But Not Evenly, Poll Shows
In many ways, the switch to virtual learning was an unexpected, unplanned experiment that was conducted on millions of school-age children. When the coronavirus pandemic struck the United States in early 2020, schools across the country closed their classrooms, handed out laptops and tablets, and gave educators a crash course in holding squirming kids’ attention over apps like Zoom.
More than two years later, there’s new information about the impact that switch has had on teens between 13 and 17 years old and their parents. In a survey released Thursday by the Pew Research Center, there are signs that some things are returning to the way they were before the pandemic, but some teenagers feel left behind. The survey found that most kids have kept close relationships with friends and families over the pandemic and that they prefer going to school in person more than remotely. However, there are notable differences in how the pandemic, specifically remote learning, has affected Black and Hispanic teenagers and lower-income families.
Legislative Session Wraps up in Albany
The end of the year’s legislative session got started with a bang… and a bear. In an incident reminiscent of the coyote that became the darling of the 2018 budget negotiations, a black bear found his way into an Albany park just a few blocks from the Capitol and later found himself stuck up a tree.
Legislation on guns, abortion, information sharing all made it through. Legislation on clean energy and packaging did not.
Ford Spending $3.7B, Creating 6,200 Jobs in Ohio, Michigan, Missouri
Ford Motor Co. continued its doubling down on electric vehicles on June 2, committing to massive plant renovations in Ohio, Michigan and Missouri, all focused on bringing more commercial EVs to market. Long the dominant automaker in U.S. vans and pickups, the $3.7 billion in plant expansions will result in more capacity for the F-150 Lightning electric pickup, E-Transit commercial van and an as-yet-unnamed electric commercial vehicle.
Ford’s investments, including the new product in Ohio, meet some conditions set forth in its contract with the United Auto Workers. The company and the UAW begin negotiations next year on a new four-year deal. The new production investments also fit in with CEO Jim Farley’s plans to split the automaker into two major divisions, Ford Model e to focus on EVs and software and Ford Blue to manage its gas-powered lineup. The bulk of Thursday’s announced investments will go to Ford Model e.
Energy Markets – Western Sanctions Against Russia Give Geopolitics an edge Over Market Forces
Russia’s attack on Ukraine is redrawing the world’s energy map, ushering in a new era in which the flow of fossil fuels is influenced by geopolitical rivalries as much as supply and demand.
Over the past half-century, oil and natural gas have moved with relative freedom to the markets where they commanded the highest prices around the world. That ended abruptly when Russian tanks rumbled across the Ukraine border on Feb. 24, triggering a barrage of trade sanctions by the U.S. and Europe targeting Russia that have plunged global commerce into disarray.
New York Senate Passes Bitcoin Mining Moratorium, Citing Environmental Concerns
Upstate New York has long been a destination for the crypto mining industry due to the region’s abundance of hydroelectric power, favorable climate for cooling rigs and the cheapest electricity prices in the Northeast. However, the industry’s foothold in New York could be coming to an end following a bill that passed early Friday in the New York State Senate. The new legislation (still waiting for the signature of Governor Hochul) calls for a two-year moratorium on proof-of-work mining that utilizes energy from carbon-based sources. Proof-of-work is used for validating transactions and mining new tokens, but requires sophisticated gear and a whole lot of electricity. The law would exempt operations that have already secured permits, though new entrants would be barred from coming online and existing licenses wouldn’t be renewed unless the facilities use renewable power.
At issue is New York’s Climate Leadership and Community Protection Act, which requires steep emissions reductions over the next decade. As a result, lawmakers set their sights on energy intensive proof-of-work mining, which has become synonymous with Bitcoin (BTC-USD), though Ethereum (ETH-USD) has also used this method (and will continue to do so for at least another few months). The country accounts for 38% of the world’s miners, and companies may seek to relocate their operations to the less-greener pastures of Kentucky, Georgia and Texas.
The Changing American Consumer Could a Shift from Goods to Services Ease Inflation?
Confined to their homes during the worst of the pandemic, consumers in the rich world splurged on appliances, cars and furniture. The binge was most notable in America, where it was fuelled by three rounds of “stimmy” cheques. Now spending is starting to shift in the other direction. Data published on May 27th showed that spending on goods fell in the year to April, and is now 9% above its pre-pandemic trend, down from a high of 16% last year. Spending on services is up by 7% in the same period, and is just 3% below pre-pandemic trends.
One question is whether the composition of consumer spending will return to pre-pandemic norms. The hope is that this eases bottlenecks and helps bring down inflation. Yet several uncertainties lie ahead. The process looks likely to be slow. If recent trends in America continue, goods and services spending will not return to pre-pandemic levels until perhaps the third quarter of next year. And some habits could stick: the rise of remote working, say, may have permanently changed the consumption mix, keeping the relative demand for goods higher than it was before the pandemic.