Not Enough Americans to Fill Jobs.
“QuickTake” provides an overview of the visa programs. QuickTake notes “it took less than a week for the U.S. government to exhaust the year’s 85,000 allotted petitions for H-1B visas” in the most recent accounting year. QuickTake goes on to discuss the history of “the U.S. system of immigration categories and caps,” and how “opposition to immigration tends to rise and fall with the state of the economy. In tough times, Americans desperate for work are none too happy to see businesses import laborers.” Nonetheless, “Employers in both the tech industry and agriculture say there are not enough Americans able to fill all the available jobs,” though opponents “say the companies are just trying to avoid paying higher wages to American workers.”
GDP Growth 1.2%
The latest gross domestic product (GDP) numbers confirm that the U.S. economy remains mired in slower-than-desired growth despite recent signs of progress in some data points. Real GDP grew just 1.2 percent in the second quarter, well below the consensus estimate of 2.6 percent, with first quarter growth revised down to 0.8 percent. This release reflects a rebound in consumer spending, but there were significant drags on activity from fixed investment and inventories. Indeed, manufacturers and other business leaders continue to be quite cautious, and as a result, they are holding back on capital spending and hiring, waiting for better signs of traction in the economy. The U.S. economy has averaged 2.2 percent growth annually since the end of the Great Recession, and with this release, real GDP is likely to expand 1.8 percent in 2016.
Rate Increase Diminished
Disappointing economic growth will also make it harder for the Federal Reserve to continue on its path toward normalization. With better data, the Federal Reserve might increase short-term interest rates at its September meeting, particularly if other indicators reflect healthier progress in the economy. However, the GDP report will likely diminish that prospect, increasing the likelihood the next rate hike will be in December or perhaps 2017.
Construction Spending Decreased
Construction spending decreased in June for the third month in a row but most segments posted solid increases in the first half of 2016 compared to the same period in 2015, according to an analysis by the Associated General Contractors of America. Association officials said spending appears to have leveled off after a strong early start to the year prompted by mild winter weather conditions in many parts of the country. “The drop in construction spending over the past three months is probably more a reflection of the very strong gains posted early in the year than of cooling demand for construction,” said Ken Simonson, the association’s chief economist. “Nearly every major segment had first-half gains of more than five percent compared with a year ago. Contractors, surveys and the media all continue to report plenty of projects are starting or will soon.” Construction spending in June totaled $1.134 trillion, 0.6 percent lower than the May total.
Manufacturing Hiring Up
NAM Chief Economist Chad Moutray said manufacturing employment rose for the first time in six months in July, “which was an encouraging development.” Manufacturers added 4,000 workers on net in July. However, Moutray notes that hiring in the sector “has been challenged so far this year, with employment down by 33,000 workers through the first seven months of 2016.” Moutray says this suggests that manufacturers “have been wary about adding to their workforce in light of ongoing global headwinds and sluggish growth in demand and production.” Moutray expects upcoming jobs data from the Bureau of Labor Statistics (BLS) for July to be “along the lines of what was reported by ADP.”
Oil Groups Against New Methane Push
A coalition of national and state oil groups “is warning federal regulators against moving too quickly” on the Obama administration’s effort to reduce American methane emissions by 40 percent to 45 percent by 2025, an effort that includes new methane leak standards for existing drilling sites. In a filing with the Environmental Protection Agency (EPA), the groups “said the agency’s collection of data for a new methane rule ‘has all the signs of a rushed job,’ officials with the Independent Petroleum Association of America (IPAA) said.”
Ride Sharing for Auto Industry.
WardsAuto says app-oriented mobility services such as car and ride sharing won’t harm the auto industry, according to a Center for Automotive Research report called “The Impact of New Mobility Services on the Automotive Industry.” Lead author of the study Adela Spulber says the growing popularity of Uber, Lyft, Zipcar, and other alternatives to car ownership instead creates “new opportunities for automakers,” such as partnerships with new-age mobility firms, R&D on transportation solutions, in-house mobility services, new-vehicle financing models and fleet sales to mobility providers.
Chinese Company Goes to NC
Chinese sanitary products manufacturer U-Play Corp. “has picked eastern North Carolina” for an 88-job manufacturing facility. The company is a contract manufacturer “that creates disposable sanitary products such as wet wipes and puppy training pads.” The company is investing nearly $21.3 million in the manufacturing site over four years, according to officials with the NC Department of Commerce.
3D Printing Wave of Future
Author Daniel Newman says the manufacturing industry “is primed for another technology revolution.” Newman adds 3D printing “represents a movement of personal manufacturing that forces us to rethink product distribution.” He says consumers will rely less on retailers as 3D printers become more mainstream, and businesses will also “reap the benefits” of 3D printing technology.
GMO Labeling Difficult for Small Manufacturers
The new GMO labeling law is putting pressure on small and medium-sized manufacturers. Companies face tough decisions, such as whether to provide the information on the label itself, use scannable codes, or steer clear of the ingredients altogether. The AP notes the Agriculture Department has two years to write regulations spelling out what food companies will be required to do to comply.
New factory orders fell 1.5 percent in June, more than the 1.0 percent initially reported, according to the Commerce Department. US Investment Orders Increased 0.4 Percent In June. A key category of orders to US businesses that tracks investment “posted a small gain” of 0.4 percent in June after two months of declines. But overall factory orders fell, which is largely a reflection of the decrease in commercial aircraft orders, the Commerce Department said. The AP says it was “the biggest setback for total factory orders since a 1.9 percent decline in February.”
Safety is Priority
The latest EHS Today National Safety Survey “finds many corporate leaders actively engage in safety efforts and communicate to workers that they value safety over production.” This year’s survey shows that “nearly 70 percent of respondents said that their company does prioritize safety over production and other business values,” and “over 80 percent said that top management provides active and visible support for occupational safety and health.”
Oil Inches Back
Crude oil “jumped as much as 5 percent” on comments from the Saudi oil minister about potential action to stabilize prices and the International Energy Agency’s forecast that crude oil markets would rebalance in the next few months.
Home Loans Troubled?
A growing number of homeowners are missing payments on their home-equity loans, which often require interest-only payments for the 10 years, at which point, principal payments are required for the next 15 or 20 years. This is significant, the Journal notes, because some 840,000 such loans taken out in 2006 are resetting this year.
Out of this World
A small 110-pound vehicle “will travel to celestial bodies by 2020, with the intent to mine for ice water, building materials and precious metals.” Designed by Deep Space Industries, Prospector-1 is set “to carryout the first commercial mining mission beyond our planet’s orbit” by flying to a near-Earth asteroid.”
Faster than a Plane
The journey between Houston and Dallas on a proposed bullet train “might actually be faster” than a plane. The US High Speed Rail Association claims the 17,000-mile high-speed rail system “could be completed as early as 2030.” The group says on their website, “This new national system will revitalize our economy, reactivate our manufacturing sector, create millions of jobs, end our oil dependency, reduce congestion, and cut our carbon footprint by epic proportions.”
South Korea Self-driving
South Korea is publicly discussing their plans for the future development of fully autonomous cars, according to local media reports. The government “will be working on developing self-driving cars, and aims to have the technology ready for expressways beginning with the year 2024.”
As automakers work to improve fuel efficiency and meet increasing mileage standards, “one promising technology on the horizon is a new type of gas-electric hybrid that draws power from a 48-volt battery,” which is more powerful than the standard 12-volt auto battery but less expensive and less complicated than the 200-volt of more power packs found in hybrids like the Toyota Prius. Even with new technologies, “automakers still have an steep uphill climb” to achieve 54.5 mpg by 2025. Last month, a joint report from the EPA and the Transportation Department “said automakers were probably able to reach only an average rating of about 50 mpg by 2025 — about 36 mpg in real-world situations.”
Speaking of New Batteries
The US Department of Energy has “partnered with” the Indian Ministry of Science and Technology “to develop smart grid and energy storage technology.” The DOE and MST are “each committing $1.5 million per year for five years” to the research initiative, “which is meant to put grid modernization on a fast track with added research and deployment.” The US funds are pending congressional approval.
Consumer safety advocates are “calling for stricter and enforceable standards” for furniture manufacturers “after a report shows current criteria do not keep children safe from dresser tip-overs.”
No Disaster Yet
Retail sales in the UK “remained resilient” in the immediate aftermath of the UK’s vote to leave the European Union, according to the latest consumer spending figures from the British Retail Consortium and KPMG. Retail sales increased by 1.1% in July, according to the data, “matching the general trend so far in 2016.”
Low Battery Demand
The Wall Street Journal reports the market for energy-storage batteries is small, and for Tesla’s new battery-producing Gigafactory to be successful, Elon Musk needs to create new demand for the company’s products. However, the Journal says the market already has a lot of potential competitors. UBS analyst Colin Langan says Tesla probably will sell about $230 million worth of batteries this year and $1 billion worth in 2017.
Stanford scientists released new results from a semiconductor materials test that could produce a new kind of chip capable of speeds 1,000 times faster than today’s memory chips. Stanford Associate Professor Aaron Lindenberg said the work is “fundamental but promising” and “suggests a path toward future memory technologies that could far outperform anything previously demonstrated.”
Engineers at the University of California’s Berkeley campus have built “dust-sized, wireless sensors that could be implanted in the human body, monitoring everything from muscles to nerves and organs.” The sensors could work inside the body “to keep track of how much we’re exercising, to stimulate the brain or muscles, or to monitor how certain organs are working.”